2024-07-26 06:52:07 ET
Summary
- FinVolution is trading at a significant discount with a forward P/E ratio of 3.7x and a price/book multiple below 1x, offering an attractive entry point for investors.
- The company has shown robust loan balance growth and successful international expansion, positioning itself as a leading player in both the Chinese and Southeast Asian credit-tech markets.
- While FinVolution assumes a higher risk profile by taking on all default risk in its loan portfolio, its robust cash reserves and efficient risk management strategies mitigate potential financial setbacks.
Introduction
In this article, I'll be covering FinVolution ( FINV ), the second-largest player in the Chinese credit-tech market. My reason for covering this market is simple: credit-tech companies in China currently represent a lucrative risk-reward profile.
For example, the two largest players in this market, Qifu Technology ( QFIN ) and FinVolution, are selling for 4.9x and 3.7x forward P/E ratios. Furthermore, Qifu is selling at around its book value, while FinVolution is selling for a price/book multiple below 1x ( Capital IQ )....
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For further details see:
Capitalize On Chinese Credit Tech Rebound Through FinVolution's Bargain Valuation