ABCAPITAL - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.0

Here’s a detailed analysis of Aditya Birla Capital Ltd (ABCAPITAL)

🧾 Core Financials

Profitability & Growth

Quarterly PAT rose from ₹654 Cr to ₹676 Cr, with a staggering 1,692% YoY profit variation, indicating a turnaround or low base effect.

EPS: ₹9.00 — decent, though not exceptional for a ₹76,000 Cr market cap.

ROE: 12.5% and ROCE: 9.48% — moderate, but improving.

Debt & Liquidity

Debt-to-equity: 4.42 — high, typical for financial services firms with lending operations.

Dividend Yield: 0.00% — reinvestment-focused, common for growth-oriented NBFCs.

📊 Valuation Indicators

Metric Value Industry Avg Remarks

P/E Ratio 32.4 32.0 Fairly valued

P/B Ratio ~3.01 ~2.5 Slight premium to book value

PEG Ratio 0.31 ~1 Undervalued relative to growth

Intrinsic Value ~₹260–₹280 — Slightly overvalued

PEG < 1 suggests strong growth potential, while P/E and P/B are in line with industry norms.

🏢 Business Model & Competitive Edge

Core Operations: Diversified financial services — lending, insurance, asset management, and wealth advisory.

Strengths

Strong parentage under Aditya Birla Group.

Integrated financial ecosystem with cross-selling potential.

DII inflows (+2.27%) reflect rising domestic institutional confidence.

Risks

High leverage and exposure to credit cycles.

FII outflows (-1.36%) may reflect valuation caution or macro concerns.

📉 Technical & Entry Zone

Current Price: ₹291

DMA 50/200: ₹275 / ₹235 — trading above key averages.

RSI: 58.8 — neutral zone.

MACD: 4.16 — bullish momentum.

Suggested Entry Zone: ₹250–₹270 range, ideally near DMA 50 or intrinsic value.

🕰️ Long-Term Holding Guidance

Hold if already invested, especially for exposure to India’s financial services growth.

Good for fresh entry on dips below ₹270.

Ideal for long-term only if

ROE sustains above 12% and debt is efficiently managed.

PAT growth continues above 15–20% CAGR.

Would you like a peer comparison with Bajaj Finserv or a breakdown of ABCAPITAL’s insurance and lending segments?

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