Mansi Finance (Chennai) Ltd Upgraded to Hold on Improved Technicals and Financial Performance

Quality Assessment: Consistent Profit Growth and Operational Strength

Mansi Finance has demonstrated a commendable financial trajectory, particularly evident in its latest quarterly results for Q2 FY25-26. The company reported a remarkable 106.02% growth in net profit, underscoring its operational efficiency and market resilience. This marks the fourth consecutive quarter of positive earnings, signalling sustained momentum in profitability.

Operating cash flow for the year reached a peak of ₹11.11 crores, while net sales for the nine-month period stood at ₹10.84 crores, both reflecting healthy business expansion. The company’s profit after tax (PAT) for the nine months rose to ₹3.40 crores, reinforcing its ability to convert revenue growth into bottom-line gains.

Despite these encouraging short-term results, the long-term fundamental strength remains moderate. The average return on equity (ROE) over an extended period is 6.62%, which is modest for the NBFC sector. Additionally, operating profit growth has averaged 6.26% annually, indicating room for improvement in sustained earnings power.

Valuation: Attractive Metrics Amidst Sector Comparisons

The company’s valuation profile has become increasingly appealing. With a price-to-book value of 0.7, Mansi Finance trades at a discount relative to its peers, suggesting undervaluation in the current market context. The return on equity of 11.1% for the recent period further supports the stock’s fair valuation.

Moreover, the price-to-earnings-to-growth (PEG) ratio stands at a low 0.1, signalling that the stock’s price growth potential is not fully priced in by the market. This is particularly notable given the company’s 24.66% return over the past year, which significantly outpaces the Sensex’s 7.97% return for the same period.

Over longer horizons, Mansi Finance has delivered exceptional returns, with a 3-year gain of 205.16% and a 5-year return of 327.39%, dwarfing the Sensex’s respective 38.25% and 63.78% performances. This track record of outperformance adds confidence to the valuation upgrade.

Financial Trend: Robust Quarterly Performance and Positive Earnings Momentum

The financial trend for Mansi Finance has been decidedly positive in recent quarters. The company’s net profit growth of 106.02% in Q2 FY25-26 is a standout metric, reflecting both operational improvements and favourable market conditions. This growth is supported by a steady increase in net sales and operating cash flows, which have reached their highest levels in recent years.

While the company’s long-term growth rates remain moderate, the recent acceleration in profitability and cash generation has been a key driver behind the upgrade. The consistency of positive quarterly results over the last four periods has helped build investor confidence and improved the overall financial outlook.

Technical Analysis: Shift to Mildly Bullish Sentiment

The upgrade in Mansi Finance’s rating is also strongly influenced by a marked improvement in technical indicators. The technical trend has shifted from a sideways pattern to a mildly bullish stance, signalling growing market optimism.

Key technical signals include a mildly bullish daily moving average and bullish Bollinger Bands on both weekly and monthly charts. The monthly MACD indicator is bullish, although the weekly MACD remains mildly bearish, suggesting some short-term caution. The Relative Strength Index (RSI) on weekly and monthly timeframes shows no clear signal, indicating a balanced momentum.

Other indicators such as the KST and Dow Theory present a mixed picture, with weekly readings mildly bearish but monthly trends mildly bullish. The stock’s on-balance volume (OBV) data is inconclusive, but the overall technical summary points to a gradual improvement in price momentum.

On 10 Feb 2026, the stock closed at ₹76.29, up 8.99% from the previous close of ₹70.00. The day’s trading range was ₹72.00 to ₹76.59, reflecting strong buying interest. The 52-week high and low stand at ₹111.95 and ₹48.55 respectively, indicating significant upside potential from current levels.

Comparative Performance: Outperforming Benchmarks

Mansi Finance’s stock returns have consistently outpaced benchmark indices and sector averages. Over the past week, the stock surged 9.41%, well above the Sensex’s 2.94% gain. Although the one-month return was negative at -3.89%, this compares to a modest 0.59% rise in the Sensex, reflecting some short-term volatility.

Year-to-date, the stock has declined by 9.57%, slightly worse than the Sensex’s -1.36%, but this is offset by strong longer-term returns. Over one year, the stock’s 24.66% gain far exceeds the Sensex’s 7.97%. The three-year and five-year returns of 205.16% and 327.39% respectively demonstrate the company’s ability to generate substantial wealth for investors over time.

Shareholding and Market Capitalisation

The majority shareholding remains with the promoters, providing stability and alignment with shareholder interests. The company’s market capitalisation grade is rated 4, indicating a mid-cap status with moderate liquidity and investor interest.

The current Mojo Score of 58.0 places Mansi Finance in the Hold category, upgraded from a previous Sell rating as of 9 Feb 2026. This reflects a balanced view that recognises both the company’s improving fundamentals and technical outlook, while acknowledging some lingering risks and valuation considerations.

Conclusion: A Balanced Upgrade Reflecting Improved Fundamentals and Market Sentiment

The upgrade of Mansi Finance (Chennai) Ltd’s investment rating to Hold is underpinned by a combination of strong quarterly financial results, attractive valuation metrics, and a positive shift in technical indicators. The company’s ability to deliver consistent profit growth and generate robust cash flows has enhanced its quality profile, while its valuation remains compelling relative to peers.

Technically, the stock has transitioned from a sideways trend to a mildly bullish phase, supported by key momentum indicators and recent price appreciation. Although some technical signals remain mixed, the overall trend suggests growing investor confidence.

Investors should consider Mansi Finance’s solid long-term returns and improving fundamentals as reasons for cautious optimism. However, the moderate long-term ROE and operating profit growth rates advise a measured approach. The Hold rating reflects this balanced perspective, recommending investors to monitor the stock closely for further developments before committing additional capital.

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