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Citi initiated coverage on Max Financial Services (MAXF:IN) with a buy rating and set a price target of INR1,840.00 for March 2027, representing a potential 21% upside from current levels.
The financial services firm values Max Financial’s operational subsidiary, Axis Max Life Insurance (NSE:LIFI), using appraisal value methodology with a 21x VNB multiple, which translates to 2.7x FY2027E P/EV. Citi applied a marginal holding company discount of 20% in its analysis due to regulatory headwinds and unclear taxation implications regarding the company’s planned reverse merger.
Citi highlighted several positive factors supporting its rating, including Max Financial’s balanced product mix with single product mix below 40% on average during FY2022-25, diversified distribution channels, and agile execution capabilities. The firm also expressed confidence in growth stability at Axis Bank (NSE:AXBK) following rebranding efforts.
The analyst noted that stability in operating releases and steady margin improvements as business mix shifts favorably remain crucial factors for boosting investor confidence and potential re-rating of the stock.
Despite the positive outlook on Max Financial, Citi indicated that HDFC Life and SBI Life remain its preferred picks within the life insurance sector.
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