Block deal: KFin Tech shares in focus as promoter eyes 6% stake sale today

KFin Technologies Ltd is in focus on Thursday amid a report suggesting General Atlantic was looking to offload 6 per cent stake in the solutions provider for investment managers and intermediaries. General Atlantic Singapore Fund Pte. Ltd is the a promoter entity of KFin Technologies, which along with General Atlantic Singapore KFT Pte Ltd, owned 32.91 per cent stake in the financial services firm.

The private equity firm could cut its stake in KFin Tech by nearly 6 per cent of the company’s total outstanding shares through block deals, sources told CNBC-TV18. The report, quoting sources, further suggested that sale is expected to be executed at a discount of 5-8 per cent over Wednesday's closing price. Business Today could not independently verify the news report.

In a note on April 29, MOFSL said structural tailwinds in the mutual fund industry are expected to drive absolute growth in KFin Tech's MF revenues. 

"With its differentiated ‘platform-as-a-service’ model offering comprehensive, end-to-end solutions powered by proprietary technology, the company is well-positioned to capitalize on strong growth opportunities in both Indian and global markets," MOFSL said.

It noted that the recent strategic investment in Ascent Fund Services marked a significant milestone, positioning KFin Tech as the first global fund administrator based in India. 

"This acquisition provides access to a diversified client base across multiple geographies, a seasoned leadership team, and robust growth potential. By leveraging Ascent’s client acquisition strengths, along with KFin Tech's  technological capabilities and strategic partnership with BlackRock’s Aladdin Provider Network, the company is well-positioned to drive sustained growth and expand market share across segments," MOFSL said.

Nuvama valued KFin Tech on an SotP basis by assigning FY27E core segment profits yielding a target of Rs 1,443 from Rs 1,230 earlier. Given the Ascent acquisition, strong deal pipeline and scope for EBITDA margin expansion, we maintain ‘BUY’, it said on April 29.

MOFSL has cut its earnings estimates for FY26 and FY27 by 3-5 per cent due to lower AUM growth expected in FY26. It expects revenue and PAT for KFin Tech to grow at 18 per cent and 21 per cent over FY25-27. 

"We maintain a Neutral rating on the stock with a one-year TP of Rs 1,150, premised at a P/E multiple of 40x on FY27E earnings," it said.