Financially strong stock to buy now for an upside of 50%; Do you own it?

Synopsis: Brokerage sees 50 percent upside in fintech major after 32 percent correction, backed by 165 percent YoY profit growth, priced-in regulatory risks, and strong premium momentum.

This article will outline why the brokerage sees an upside in shares of this company, which primarily earns commissions by facilitating sales and renewals of insurance policies and financial products.

With a market capitlization of Rs 68,131 crore, the share of PB Fintech Ltd on Thursday opened at Rs 1,485 per share, up 0.56 percent from its previous day’s close price of Rs 1,477.55 per share.  The stock of the company trades at an overvalued P/E of 118x, compared to the industry’s average P/E.

Brokerage’s View

PB Fintech has corrected 32 percent from its peak, yet Bernstein maintains a target price of Rs 2,210, implying 50 percent upside from current levels. The brokerage believes much of the recent pessimism is already reflected in valuations, creating a favourable risk-reward setup for long-term investors.

Bernstein notes that commission regulation risks appear largely priced in, with meaningful downside only in the event of sharp take-rate cuts, which it considers unlikely. Current valuations already factor in a 15 percent top-line impact, while even a 10–12 percent hit would translate into a 20 percent reduction in term and health plan estimates.

Concerns around AI-based insurance wrappers are seen as overstated. PB Fintech is viewed as well-positioned to develop comparable AI-driven platforms, leveraging its scale, data advantage, and distribution strength. This limits the threat from new-age technology disruptors attempting to alter the insurance aggregation landscape.

However, AI-led changes in search engine algorithms remain a structural risk due to potential pressure on organic traffic. That said, improving conversion ratios and deeper customer engagement could partly offset traffic moderation. Sustained leadership in industry-wide AI adoption will be critical to preserving competitive moat and long-term growth trajectory.

Business highlights

In Q3 FY26, the company delivered strong operating momentum across segments. Total insurance premium rose 45 percent YoY to Rs 7,965 crore, while total lending disbursal surged 84 percent YoY to Rs 9,986 crore. Total revenue increased 37 percent YoY to Rs 1,771 crore. Profitability improved sharply, with PAT jumping 165 percent YoY from Rs 71 crore to Rs 189 crore, representing 2.38 percent of total premium.

Growth was led by protection products, with health and term insurance new premiums expanding 68 percent YoY, while core online insurance premiums grew 44 percent YoY. Core lending disbursal improved 8 percent sequentially, reflecting steady demand traction. India insurance premium figures exclude GST. New initiatives retained leadership positioning, and PB Partners sustained strong momentum in premium growth.

PB Fintech Ltd, popularly known as Policy Bazar, is India’s largest online platform for insurance and lending products through its flagship brands – Policybazaar and Paisabazaar platform through which they provide convenient access to insurance, credit and other financial products. The company operates a diversified digital marketplace spanning insurance and credit. 

Policybazaar offers end-to-end protection solutions against death, disease, and disability, including corporate and UAE operations. Paisabazaar enables credit access and score management through proprietary algorithms, while PB Partners and PB Connect empower over 400,000 partners to distribute insurance and credit products efficiently.

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