CREDITACC - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 3.6

📈 Positive

• 📈 Quarterly PAT doubled from ₹60.2 Cr. to ₹126 Cr., indicating strong sequential recovery.
• 📈 DII holding increased by 0.57%, showing rising domestic institutional confidence.
• 📈 MACD at 20.2 and RSI at 60.1 reflect bullish technical momentum.
• 📈 Trading above DMA50 and DMA200 (₹1,360 and ₹1,239), confirming medium-term strength.

⚠️ Limitation

• 📉 Extremely high P/E of 168 vs industry average of 93.2 suggests severe overvaluation.
• 📉 PEG ratio of 11.5 implies valuation is not supported by sustainable growth.
• 📉 Low ROE (7.86%) and ROCE (9.55%) reflect modest capital efficiency.
• 📉 Debt-to-equity ratio of 2.81 indicates high leverage, typical for NBFCs but still a risk factor.
• 📉 Dividend yield of 0.00% offers no passive income.

📰 Company Negative News

• 📉 Quarterly profit variation of -32.4% suggests volatility in earnings performance.
• 📉 EPS of ₹8.36 is low relative to price, limiting valuation justification.

🌟 Company Positive News

• 📈 FII holding increased by 0.16%, indicating renewed foreign investor interest.
• 📈 52-week performance up 89.0%, showing strong price appreciation and investor optimism.

🏦 Industry

• 🏦 CREDITACC operates in the NBFC sector, focusing on microfinance and retail lending, benefiting from financial inclusion trends.
• 📊 Industry P/E of 93.2 reflects high growth expectations and premium valuations for niche lenders.

🧭 Conclusion

• 📌 Suggested entry zone: ₹1,350–₹1,390, near DMA50 for better margin of safety.
• 🕰️ Long-term holding cautious due to valuation concerns and earnings volatility.
• ⚖️ Monitor asset quality and capital efficiency before aggressive accumulation.