Why Aditya Birla Capital Share Price is Rising

Indian share markets are currently defying gravity propelled by fresh foreign fund inflows and a rally in the US and European markets.

The BSE Sensex crossed the 64,000 mark intraday today for the first time to hit a new all-time high while the Nifty scaled 19,000.

After multiple attempts, the domestic market has successfully managed to sustain record high levels, thanks to the increased buying interest in heavyweight stocks.

Amid the rally in the heavyweight stocks, there are other stocks have also seen a jump in their stock price.

One such company is Aditya Birla Capital.

The company's shares are up by more than 7% in the last five days and more than 16% in the last month.

Let's find out why the company's shares are rising.

Company to raise up to Rs 17.5 bn via QIP

Aditya Birla Capital has proposed to issue equity shares worth up to Rs 17.5 bn through a qualified institutional placement (QIP), according to a term sheet seen by Reuters.

The issue price for the placement is between Rs 170-176, a 6.2% to 2.9% discount to Monday's closing level of 181.25 rupees.

The financial services firm will use the proceeds from the fundraise for investment in its units, joint ventures, and associates, among other corporate purposes.

The bookrunning managers for the issue are BofA Securities India, Jefferies India, Axis Capital, and ICICI Securities.

Earlier this month, Aditya Birla Capital said that the board of directors has approved preferential issuance of Rs 12.5 bn to Grasim and Surya Kiran Investments.

This issuance is a follow-up of Rs 30 bn equity fundraising that was approved earlier last month.

Both Grasim and Surya Kiran Investments are part of the promoter and promoter group entity in Aditya Birla Capital. As per the regulatory filing, the company will raise Rs 10 bn from Grasim and Rs 2.5 bn from Surya Kiran Investments.

Improved profitability and business momentum

Aditya Birla Capital's stock price has risen by 24% in 2023 on the back of improved profitability and business momentum.

In FY23, the company posted consolidated revenue of Rs 300 bn and a net profit of Rs 20.6 bn (excluding fair value gains).

ABCL through its subsidiaries/JVs has a strong presence across protecting, investing, and financing solutions catering to the diverse needs of its customers across their life cycle.

As of 31 March 31, 2023, the company manages aggregate assets under management of about Rs 3.6 tn with a total lending AUM of Rs 944 bn and gross written premium of Rs 178 bn in life and health insurance businesses.

A wholly owned subsidiary, Aditya Birla Capital Digital Limited was established on 23 March 2023 to develop an omni-channel direct to customer (D2C) platform.

This platform will serve the existing customers, acquire new customers and act as a one stop-solution to deliver protecting, investing, financing and advising (PIFA) solutions to customers.

How Aditya Birla Capital shares have performed recently

Aditya Birla Capital shares have risen by more than 7% in the last five days. Over the past month, the company's shares are up by more than 16%.

The stock is also up by 24% in 2023.

AB Capital touched its 52-week high of Rs 195 on 28 June 2023 while it touched a 52-week low of Rs 88 on 30 June 2022.

About Aditya Birla Capital

Aditya Birla Capital is the holding company for the financial services businesses of the Aditya Birla Group, is a universal financial solutions group catering to the diverse financial needs of its customers across their life stages.

The company has a portfolio across lending, insurance, asset management, and other services which caters to a wide range of customer segments, needs, channels, and geographies.

Main companies under its portfolio include Aditya Birla Finance, Aditya Birla Housing Finance, Aditya Birla Sun Life Insurance, Aditya Birla Sun Life AMC, Aditya Birla Health Insurance, etc.

The subsidiaries of the company have a nationwide reach with 950 branches and more than 2,00,000 agents/channel partners and several bank partners.

To know more about the company, check out Aditya Birla Capital's fact sheet and quarterly results.

You can also compare AB Capital with its peers on our website.

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