Stock to buy for short-term: Anand Rathi sees 31% upside in this LIC-owned small-cap NBFC stock. Do you own?

Paisalo Digital share price plunged over 4% on Tuesday, extending its decline for the fourth consecutive session. Paisalo Digital shares dropped as much as 4.85% to ₹38.20 apiece on the BSE.

The LIC-owned stock has declined by 11% over the past month and has recorded a year-to-date (YTD) drop of over 22%. Over the last six months, the small-cap stock has fallen by 38.5%, and it has declined nearly 50% over the past year.

However, Paisalo Digital shares have rallied 30% in two years and delivered multibagger returns of 195% in the past five years.

Should you buy Paisalo Digital shares?

Paisalo Digital stock is brokerage firm Anand Rathi’s pick for the month as it believes the smallcap stock has upside potential of 31%, based on the technical charts.

“After peaking near ₹63.74, Paisalo Digital shares declined by approximately 25 points, a drop of about 40%. The stock recently completed a 1:1 corrective leg near its previous breakout zone, aligning with the S1 Monthly Floor and S3 Monthly camarilla support pivots. This confluence of technical supports suggests a potential reversal,” Anand Rathi said in a note.

Based on these factors, Anand Rathi recommends a long position in Paisalo Digital shares at ₹37 - ₹39 zone. Paisalo Digital share price target is set at ₹50, capitalizing on the potential rebound, while the stop-loss is placed at ₹32 on a closing basis to manage downside risk.

The target price implies an upside potential of around 31% from current market price. The timeframe for the trade is one month, as per the brokerage firm.

This strategic setup leverages the strong support zones and aims for a favorable risk-reward ratio, Anand Rathi said.

LIC Shareholding in Paisalo Digital

State-owned insurance giant, Life Insurance Corporation of India (LIC), holds a significant stake in the non-deposit-taking NBFC, Paisalo Digital. As per the shareholding pattern for the December 2024 quarter, LIC owned 84,73,644 equity shares in the company, representing a 1.35% stake.

Paisalo Digital shares hit a 52-week high of ₹99.63 apiece on March 01, 2024, and touched a 52-week low of ₹38.10 apiece on February 17, 2025.

At 2:30 PM, Piasalo Digital stock price was trading 4.63% lower at ₹38.29 apiece on the BSE. 

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.