⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
IIFL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.2
| Stock Code | IIFL | Market Cap | 20,794 Cr. | Current Price | 489 ₹ | High / Low | 675 ₹ |
| Stock P/E | 30.4 | Book Value | 162 ₹ | Dividend Yield | 0.82 % | ROCE | 6.57 % |
| ROE | 4.20 % | Face Value | 2.00 ₹ | DMA 50 | 517 ₹ | DMA 200 | 506 ₹ |
| Chg in FII Hold | 1.00 % | Chg in DII Hold | 0.03 % | PAT Qtr | 301 Cr. | PAT Prev Qtr | 211 Cr. |
| RSI | 45.5 | MACD | -13.6 | Volume | 9,91,520 | Avg Vol 1Wk | 10,41,955 |
| Low price | 306 ₹ | High price | 675 ₹ | PEG Ratio | -1.01 | Debt to equity | 4.55 |
| 52w Index | 49.7 % | Qtr Profit Var | 1,785 % | EPS | 16.1 ₹ | Industry PE | 17.2 |
📊 Financial Overview
- Revenue & Profitability: PAT rose from ₹211 Cr. to ₹301 Cr. (QoQ), showing strong growth momentum.
- Margins: ROE at 4.20% and ROCE at 6.57% are weak, reflecting limited profitability and efficiency.
- Debt: Debt-to-equity ratio of 4.55 is high, raising concerns about leverage risk.
- Cash Flow: EPS of ₹16.1 is decent, but valuation multiples remain stretched.
💹 Valuation Metrics
- P/E Ratio: 30.4 vs Industry PE of 17.2 → overvalued compared to peers.
- P/B Ratio: Price ₹489 vs Book Value ₹162 → trading at a steep premium.
- PEG Ratio: -1.01 → negative, suggesting growth does not justify valuation.
- Intrinsic Value: Current valuation looks expensive; fundamentals do not support premium multiples.
🏢 Business Model & Competitive Advantage
- IIFL operates in diversified financial services including wealth management, loans, and advisory.
- Competitive advantage lies in diversified offerings and strong brand presence, but profitability metrics remain weak.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: ₹400–450 range looks safer given overvaluation and weak fundamentals.
- Long-Term Holding: Suitable only for growth-oriented investors willing to tolerate risk. Monitor debt levels and profitability closely.
✅ Positive
- Quarterly PAT growth from ₹211 Cr. to ₹301 Cr. shows strong momentum.
- EPS of ₹16.1 indicates earnings stability.
- FII holdings increased by 1%, showing foreign investor confidence.
⚠️ Limitation
- High debt-to-equity ratio (4.55).
- Low ROE (4.20%) and ROCE (6.57%).
- P/E ratio of 30.4 is much higher than industry average.
📉 Company Negative News
- Stock trading below DMA 50 & DMA 200, indicating bearish technical trend.
- PEG ratio negative (-1.01), suggesting valuation mismatch with growth.
📈 Company Positive News
- Strong quarterly profit growth (₹301 Cr. vs ₹211 Cr.).
- FII inflows show rising institutional interest.
🏦 Industry
- Industry PE at 17.2 highlights sector is valued lower than IIFL.
- Financial services sector growth supported by wealth management demand and retail credit expansion.
🔎 Conclusion
- IIFL shows strong profit growth but remains overvalued with weak ROE and high debt.
- Entry around ₹400–450 is safer for long-term investors.
- Hold only if profitability continues to improve and debt levels are managed effectively.