Nomura cut its price target on PB Fintech to ₹1,100 from ₹1,590 earlier, while maintaining its “neutral” rating on the stock. The revised price target implies an upside potential of only 5.8% from Wednesday’s closing levels.
The brokerage has also trimmed PB Fintech’s net profit estimates for financial year 2028 and 2029 by 72% and 51% respectively.
PB Fintech’s point of sales person (POSP) businesses’ premiums have been trimmed by Nomura on the assumption that the company exits this segment, while PolicyBazaar, Dubai and the corporate segment have been left untouched.
Take rates have also been revised according to the proposed commission caps, Nomura wrote in its note. As a result, the estimates for PB Fintech’s total expenses have been revised lower for financial year 2028 and 2029 by 40% and 48% each respectively.
Nomura now expects PB Fintech’s Cash Flow to grow at a Compounded Annual Growth Rate (CAGR) of 13.2% compared to the earlier projection of 15.1% over financial year 2026-2030.
PB Fintech shares have been volatile after a sharp sell-off post the Insurance Regulatory and Development Authority of India (IRDAI) releasing guidelines on distribution norms.
The IRDAI proposed tighter limits on insurers’ management expenses and commission cuts of up to one-half to two-thirds in health, term and motor insurances. The proposals aim to curb distribution costs and bring greater discipline to the industry.
On October 1, PB Fintech shares slipped below their IPO price of ₹980 apiece, wiping out five years of gains.
The IRDAI released its guideline norms on September 23, following which the PB Fintech stock declined 48.2% over seven consecutive trading sessions. The stock has been in the green for two sessions post that recovering 6% on Tuesday, October 6, and ending 0.5% higher at ₹1,040.1 apiece on Wednesday, October 7.
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