Why Is Nuvama Bullish On Capri Global Capital’s Growth Path?

What Makes Nuvama Confident About Capri Global Capital’s Growth Story?

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Capri Global Capital Limited (CGCL) is a rapidly growing non-banking financial company (NBFC) in India, primarily operating in retail and SME lending. With strong traction in affordable housing finance, MSME loans, and gold financing, the company has been strategically expanding its footprint across India. As of FY25, it has been focusing on sustainable growth through branch expansion, product diversification, and prudent credit cost management.

Recently, brokerage firm Nuvama reiterated its positive outlook on CGCL, maintaining a bullish stance. It projects healthy growth in assets under management (AUM), consistent asset quality, and robust returns, supported by management’s clear roadmap toward FY28 targets. Here’s a deeper dive into why Nuvama is optimistic about the company’s trajectory.

Strong Growth in Assets Under Management

Nuvama forecasts a 30% CAGR growth in AUM over the next 2–3 years. Capri Global aims for a sizeable ₹50,000 crore AUM by FY28E. This growth will be driven by geographic expansion, entry into underpenetrated markets, and deeper penetration in existing business verticals.

Profitability Outlook: ROE and ROA

By FY28E, management expects ROE between 16–18% and RoA close to 4%. The improvement will be supported by:
• Higher fee income contribution.
• Scale benefits from operating leverage.
• Efficiency gains from digitalization and risk management systems.

Asset Quality and Risk Management

Capri Global’s asset quality remains strong with GNPA below 2% and NNPA around 1.2%. A rigorous focus on collections, diversified loan mix, and prudent credit cost management has been key to this performance. This resilience in asset quality provides confidence to investors about the sustainability of growth.

Branch Expansion Strategy

To strengthen its retail lending presence, Capri Global plans to open 150–200 new branches in FY26. This aggressive expansion will help the company tap semi-urban and rural markets, enhance customer engagement, and provide last-mile connectivity. The branch-led growth model complements its digital initiatives, ensuring wider outreach and sustainable disbursal growth.

Diversification as a Key Growth Lever

Capri Global’s loan portfolio is diversified across housing finance, MSME loans, gold loans, and consumer lending. This balanced exposure mitigates sectoral risks and provides stable earnings. Over the medium term, management’s emphasis on risk-adjusted returns and maintaining adequate provisioning is expected to keep earnings resilient.

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Earnings Visibility and Long-Term Outlook

Nuvama believes Capri Global’s strong earnings trajectory will be underpinned by its scalable operating model, diversified loan book, and efficient cost structure. With credit costs expected to remain benign and branch expansion driving disbursal volumes, long-term visibility for revenue and profitability looks strong.

Investor Takeaway

Nuvama’s analysis underscores Capri Global Capital’s strong potential to deliver growth with stability. With AUM likely to expand at a healthy pace, asset quality under control, and a clear expansion roadmap, the company appears well-placed for long-term wealth creation. For investors tracking NBFCs, this is one name to watch closely over the next few years.

Keep following such in-depth market insights and sectoral updates at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.

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SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.

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