Shriram City Union Finance (Strong franchise, BUY): Shriram City Union Finance (SCUF) is a niche player offering small business and personal loans in the rural and semi-urban markets of south India. We expect penetration into new geographies and the Group's large captive client base to drive a CAGR of 27% and 23% in assets and earnings, respectively over FY10-13ii. Valuations at FY12ii P/B of 2.3x are attractive given the well-established business model, robust earnings growth and return expectations. We initiate with BUY and Rs790 target price.
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