So all in all, this is could be last equity dilution to facilitate company in achieving 1 Lakh Crore AUM, with improved credit rating, lower cost of fund.
Wondering if this assumption can be factored - or it can go wrong - considering the (not so good) track record of company’s management.
I think they will not require dilution for next 18 months and future dilution will be at very higher price if everything goes well…
Let’s now incorporate future equity dilution into the bullish, moderate, and bearish scenarios, assuming additional equity is required in the bearish case due to higher NPAs and regulatory requirements. This impacts net worth, shares outstanding, and valuation metrics.
Bullish Case:
Moderate Case:
Bearish Case:
| Scenario | Gross NPA (%) | Adjusted ROA | Leverage (D/E) | Net Profit (₹ Cr) | Shares Outstanding (Cr) | EPS (₹) | BVPS (₹) | ROE (%) |
|---|---|---|---|---|---|---|---|---|
| Bullish | 1.0% | 5.95% | 4x | 4,760 | 92 | 51.74 | 271.74 | 17.85 |
| Moderate | 2.5% | 4.35% | 4x | 3,480 | 94 | 37.02 | 266.67 | 13.05 |
| Bearish | 4.0% | 2.90% | 4x | 2,320 | 102 | 22.75 | 264.71 | 8.70 |
| Scenario | P/E-Based Price (₹) | P/BV-Based Price (₹) | Range (₹) |
|---|---|---|---|
| Bullish | 931–1,294 | 815–1,087 | ₹815–1,294 |
| Moderate | 444–555 | 667–800 | ₹444–800 |
| Bearish | 182–228 | 529–662 | ₹182–662 |
Bullish Case (Minimal Dilution):
Moderate Case (₹1,000 Cr Equity Dilution):
Bearish Case (₹3,000 Cr Equity Dilution):
Considering all this margin of safety seems high…
Obviously I haven’t considered extremely bearish case which is also a possibility and one may even loose from current price in that scenario
So book value per share will not change from the current book value even if they achieve their Fy27 vision?
Thanks for pointing mistakes:
Some good inputs on affordable housing finance also in this.
Sammaan Capital has received a bid of Rs 2577 Cr for a sale of distressed loans with principal outstanding of Rs 4057 Cr. The company is going for a Swiss challenge auction to further improve this bid. If I am not wrong, the bad loans are required to be provided 100% before sale to ARCs. Hence, this recovery is possibly from the written off pool of 10,000 Cr. If that is true, then this entire Rs 2577 Cr (or higher amount as determined by the auction) will flow thru into net worth.
Of course the ARCs issue security receipts (SRs) which are redeemed into cash only as the ARC recovers the principal through resolution of the bad loans. So the cash may come in 3-5 years down the line, but at least the net worth can be jacked up immediately unless the company retains the recovery as provisions against other bad loans.
Need to look out for announcements on this front or at least question the company in next concall on the outcome of this sale.
Turns out I am quite wrong on the above post. The company need not provide 100% before sale to ARCs. It can provide just enough so that the Net Book Value of the bad loans is roughly equal to the estimated receipt from ARCs. Thereafter, the actual sale can happen at, above or below the Net Book Value and the difference needs to flow through the P&L. The company has been doing these transactions every year for the past few years. Snapshot from FY24 AR is attached.
Hence, assuming the NBV of the pool of bad loans was roughly equal to Rs 2500 Cr before the auction, there will be no material change in net worth after the transaction. The bad loans on the books will be replaced by SRs and cash.
The GNPA will be reduced to the extent of Rs 4057 Cr as the bad loans get taken off the company’s books. But since total Stage 3 and Stage 2 assets of the legacy book add up to Rs 2380 Cr (Q2FY 2025 earnings update), it is probably fair to assume that at least Rs 1677 Cr of this pool of Rs 4057 Cr of bad loans is already written off and the transaction will result in recovery of at least Rs 1065 Cr [63.5% (=2577/4057) of 1677 Cr) from the written off pool.
Interestingly, the slide 17 of Q2FY2025 earnings deck also mentions expected recovery of Rs 1650 Cr (presumably from the written off pool) in H2FY2025. So, there may be more such sales in the offing.
Another interesting point around this pool of Rs 4057 Cr is that the number of accounts are 6497 resulting in average loan outstanding per account to be Rs 62 lakh. So these are individual home loans that have gone bad. Hopefully these should be relatively easier to recover than some large ticket commercial loans. This also indicates that the company’s problems in the legacy book weren’t all pertaining to commercial exposures. It made mistakes in its individual home loan underwriting as well.
Thanks for sharing valuable input regarding Legacy book.
At least, this gives assurance that Management has done a thorough review and last commentary by Gagan has projected most of the facts transparently.
Legacy book is past(Regardless commercial/residential) and accordingly market already discounting the stock from its Book Value.
In my view, its a matter of time when market recognizes and start believing in Ganga and than we can expect share to trade at its Book Value(At least)
Indigo promoters take 1.4 percent stake in company as per December Shareholding. Lets see quality of shareholders who subscribe to current QIB. Invested for long term.
QIP fully subscribed at Rs 150 and gives confidence on future growth capital in this tough environment. Quality of investors also gives confidence on current valuations
Hi Amit,
Names you have cited are similar, but not same. These potentially belong to two different individuals.
Sammaan Capital Limited - Q3 FY25 Earnings Update
Financial Performance
• Net Worth: ₹20,331 Cr in Q3 FY25.
• Assets Under Management (AUM) : ₹61,947 Cr, with:
• Legacy AUM: ₹26,995 Cr.
• Growth AUM: ₹34,952 Cr.
• Net Interest Income (NII) : ₹823 Cr.
• Profit After Tax (PAT) : ₹302 Cr.
• Gearing: 2.2x, significantly reduced over the years.
• Asset Quality :
• Gross NPA : 1.14% .
• Net NPA : 0.66% .
Balance Sheet & Debt Management
• De-leveraging Focus : Gearing reduced from 8.6x in FY18 to 2.2x . Plus point!
• Since September 2018, the company has repaid:
• ₹83,000 Cr in debt principal.
• ₹40,000 Cr in interest payments.
• Cumulative PAT from 2018 to 9M FY25 : ₹12,780 Cr.
• Equity Capital Raised in Last 12 Months : ₹5,000 Cr.
Growth AUM Business Structure
• Sammaan Capital Limited (SCL) : Focuses on prime mortgage origination and acts as a holding company.
• Sammaan Finserve Limited (SFL) : Specializes in affordable home loans and semi-urban MSME LAP (Loan Against Property).
• AIF Platform : Engages in wholesale lending with partner funds .
Strategic Priorities & Targets
• Growth AUM Target : ₹1,00,000+ Cr consolidated AUM by FY27 .
• SFL Standalone Growth AUM Target : ~₹15,000 Cr by FY27 .
Asset Quality & Loan Book
• Retail Loan Book: High-quality portfolio with sold-down pools of ₹91,508 Cr.
• Partnerships: Relationships with 24 banks/financial institutions for loan sell-down.
Branch Network
• 214 branches across India, including:
• Head Offices .
• Master Service Centers .
• Main Branches & Service Branches .
• Sammaan Finserve branches .
Funding & Borrowings
• ₹9,248 Cr raised from April 2024 to January 2025 .
• On-balance sheet borrowings have increased over 3x YoY .
Legacy Business Reduction
• Accelerated rundown of the legacy business, reduced by ₹14,300 Cr in the last 12 months.
Asset Quality Trends
• Gross & Net NPAs at their lowest levels in six years .
Real Estate Market Trends
• India’s real estate sector contribution to GDP is projected to grow 2.1x .
• The residential market has seen strong growth post-pandemic, with annual sales volumes growing at 23% CAGR since 2020 .
Conclusion
Sammaan Capital Limited continues to focus on de-leveraging , AUM growth , and asset quality improvement , while capitalizing on India’s booming real estate sector . With a targeted ₹1,00,000 Cr AUM by FY27 , a well-capitalized balance sheet , and expanding branch and funding networks , the company is poised for sustained long-term growth . 
“While the hearing in relation to the said matter is ongoing, the Hon’ble High Court of Delhi vide its order dated February 10, 2025 (“Interim Order”), has allowed the interim application of Svamaan, restraining the Company from using the word ‘Sammaan’ or any other word deceptively similar to ‘Svamaan’. Please note that the matter is currently pending, and the next date of the hearing is scheduled for March 27, 2025.”
Sammaan Capital has successfully executed its transition from a legacy-heavy lender to an asset-light, tech-driven NBFC. With improving profitability, strong asset quality, and aggressive AUM growth plans, it is well-positioned for a significant re-rating in the next 3-5 years.
At 0.525x P/B, the stock appears deeply undervalued, considering its FY27 targets of ₹1 lakh crore AUM, ROA (targeted steady-state), moving towards 4%
, and 16-18% ROE. If the company executes as guided, a P/B re-rating to 1.5-2.0x could drive significant upside. However, near-term stock movement remains contingent on sustained ROE expansion & investor confidence in growth execution.
@ Guys: How much serious is this trademark dispute between Svaaman Fintech. Svaaman seems to have strong pedigree with Jindals at its forefront.Finally things were falling in place for Samman and now this? How much distraction this can cause? Any thoughts!!!
To assess the potential impact of the trademark dispute with Svamaan Fintech, we need to factor in legal expenses, rebranding costs, operational disruptions, and market perception effects.
Estimated Legal + Settlement Costs: ₹25-65 crore
If the court upholds the interim injunction, Sammaan Capital may need to undergo another complete rebranding, including:
Estimated Rebranding Costs: ₹80-160 crore
Revenue Impact: ₹50-150 crore (lower loan disbursals + customer attrition)
Market Cap Impact Estimate: ₹1,000-1,500 crore drawdown if uncertainty remains for 6+ months
| Cost Category | Estimated Range (₹ Crore) |
|---|---|
| Legal Fees & Settlement | ₹25-65 crore |
| Rebranding Costs | ₹80-160 crore |
| Business Disruption | ₹50-150 crore |
| Market Cap Drawdown | ₹1,000-1,500 crore |
Total Estimated Cost Impact: ₹155-375 crore in direct costs + ₹1,000-1,500 crore potential stock value loss
If Sammaan Capital loses the case and must rebrand, total financial costs could reach ₹300+ crore, and stock price may remain subdued until clarity emerges.
Best-Case Scenario: If Sammaan successfully defends the case, legal costs will be the only expense (~₹25-65 crore), and stock re-rates once resolved.
Worst-Case Scenario: If forced to rebrand and compensate Svamaan, it could set back growth by ~1 year and delay its target of 1.5-2x P/B re-rating.
Sammaan Capital’s best move is to push for a quick legal resolution or negotiate a settlement to avoid prolonged uncertainty impacting growth plans and investor sentiment.
As stock already beaten down around 15% in last week, seems worst case is priced in.
See the company disclosure: they are creating headline of Stay & not giving complete picture. Key point is to mention IB Housing’s name & logo on all advertisements
High Court Stayed Operation of earlier Order.pdf (283.2 KB)
You are right in saying that they will have to have IB housing’s name and logo and also need to mention that they have no connection with Svamaan finance everywhere. But I think this stay (Division bench) on the earlier order (Single Judge) is a big relief in the interim and is a workable solution for both parties. The earlier order had literally put the whole brand in question and Akash_Padhiyar above had done a great analysis of the financial impact of that single judge order.
