PB Fintech Jumps 4% After CEO Proposes $100 Mn Investment For Healthcare Foray

SUMMARY

PB Fintech is likely to make a one-time investment of $100 Mn to acquire a 30% stake in a new healthcare company after getting approval from its board

Brokerage firm Bernstein has maintained its ‘outperform’ rating on PB Fintech with a price target of INR 1,750 per share

PB Fintech posted a consolidated net profit of INR 59.98 Cr in Q1 FY25 as against a loss of INR 11.9 Cr in the year-ago quarter

Shares of PB Fintech, the parent company of PolicyBazaar and Paisabazaar, jumped over 4% to INR 1,715.40 apiece on the BSE during the intraday trading today (September 30) after chairman and Group CEO Yashish Dahiya confirmed that the company is considering making a foray into the healthcare space.

PB Fintech is likely to make a one-time investment of $100 Mn to acquire a 30% stake in a new healthcare company after getting approval from its board, Dahiya told CNBC-TV18.

Explaining the rationale behind the company’s move to venture into the healthcare space, Dahiya reportedly said that a middle class person can’t afford to spend INR 78,000 for a bed per night, adding that PB Fintech aims to bridge the gap between hospitals and insurance companies.

Reports of PB Fintech’s plans to enter the healthcare sector had surfaced last week. In an exchange filing on September 27, it said that Dahiya mentioned during the last analyst call that the company was exploring plans to enter the healthcare market.

PB Fintech has given bumper returns to investors since its public listing in 2021. The stock has surged over 67% from its issue price of INR 950 per share and is up 42% from its listing price of INR 1,150 apiece. On a year-to-date basis, it has skyrocketed over 107%.

Last week, brokerage firm Bernstein maintained its ‘outperform’ rating on PB Fintech with a price target of INR 1,750 per share. This implies an upside potential of almost 7% from the stock’s previous close.

The brokerage noted that investors are bullish on the stock owing to high growth, strong business model and cash generation.

The optimism is not without reason. PB Fintech reported its third consecutive profitable quarter in the April-June period.

The company posted a consolidated net profit of INR 59.98 Cr in the June quarter (Q1) of the financial year 2024-25 (FY25) as against a loss of INR 11.9 Cr in the year-ago quarter.

The turnaround came largely on the back of robust growth across business segments.