3450% Dividend In FY23: ICICI Sec Raises Target Price For This Dividend Paying Stock, Expects 15% Upside

360 One WAM Ltd (IIFLW) is a mid-cap company which deals in the financial services sector. The stock has given a whopping dividend payout of 3450% in FY23, however, it is the dividend-paying stock and is going to turn ex-dividend soon on 28th July for 400% interim dividend. After the company's Q1FY24 performance, the brokerage firm ICICI Securities has raised to INR 593 (earlier: INR 501) which implies a potential upside of 15% from its current market price.

360 One WAM Dividend

At a meeting held on July 20, 2023, the Board of Directors of the company informed stock exchanges that they have approved "Second interim dividend for the financial year 2023-24 of Rs. 4/- (Rupees four only) per equity share of face value of Re. 1/- (Rupee one only) each and has fixed record date as Friday, July 28, 2023, for this purpose. The said interim dividend will be paid / dispatched on or before Friday, August 18, 2023, subject to applicable taxes."

360 ONE WAM has announced an equity dividend of 3450.00% at a face value of Rs 1, or Rs 34.5 per share, for the financial year ended March 2023. The dividend yield at the current share price of Rs 517.65 is 6.66%. The company has a solid track record of dividend declarations during the past five years. According to statistics from Trendlyne, 360 One Wam Ltd. has issued 12 dividends since October 31, 2019.

360 One WAM Financials

In the quarter that ended in June 2023, the company's profit after tax (PAT) climbed by 13.4% to Rs 181 crore from Rs 160 crore in the corresponding period of the previous year. In Q1FY24, the company's total revenue climbed 17.6% to Rs 434 crore from Rs 369 crore in Q1FY23. Strong net flows of Rs 12,975 Cr. were seen during the quarter in the ARR sector, and ARR AUM was at Rs 1,90,390 Cr., up 33.3% YoY.

Mr. Karan Bhagat, MD & CEO, 360 ONE WAM said "In Q1, the domestic market sentiment improved greatly driven by several green shoots. India's benchmark equity indices touched record highs supported by uninterrupted FPI inflows in conjunction with key high frequency economy indicators showing signs of steady economic activity and strong corporate results. While the global outlook remains mixed, we believe strong local macro trends will enhance India's appeal, as a favoured investment destination, in the long term."

"We strongly believe India's long-term inclusive growth trends will continue to fuel overall wealth creation, and particularly for the HNI and UHNI segment. Increasing financialization and client sophistication will drive a disproportionate rise in this segment. 360 ONE WAM, with its advisory mindset, comprehensive wealth and alternates' focused product shelf, product innovation and, emphasis on consistent & high-quality revenues that remain aligned with the clients' interests, is well-positioned to optimally leverage these trends," stated Karan Bhagat.

360 One WAM Share Price Target

"360 One WAM Ltd (IIFLW) maintains its guidance for a profit of INR 8bn in FY24 (up 20% YoY) with expectations of 6% MTM gains and INR 400bn in ARR flows (up 43% YoY) while maintaining its ARR retention rate guidance (ARR = annual recurring revenue). Q1FY24 performance shows strong 33% YoY growth in ARR AUM while there are factors that will help increase the annual retention rate beyond 73bps reported in Q1FY24. Company is focused on maintaining its leadership in the recurring revenue book while targeting the growth levers of deepening wallet share of existing clients, expanding to new geographies as well as entering new mid-market segments," said the brokerage firm ICICI Securities.

"Maintain BUY with a revised target price of INR 593 (earlier: INR 501) based on 22x (earlier: 20x) FY25E EPS of INR 27 (earlier: INR 25)," said ICICI Sec.

"360 One is planning to implement a new ESOP scheme in which it would grant options to ~15% of total employees. This scheme would focus on senior management with the objective to retain key talent and align employee compensation to long-term performance. The total cost to company would be INR 1bn-1.2bn, which is around 3.15% of total paid-up capital as of date. This cost would be amortised over 7-8 years," according to the brokerage.

Disclaimer

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