MANAPPURAM - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | MANAPPURAM | Market Cap | 27,420 Cr. | Current Price | 325 ₹ | High / Low | 327 ₹ |
| Stock P/E | 18.0 | Book Value | 188 ₹ | Dividend Yield | 1.08 % | ROCE | 9.53 % |
| ROE | 11.0 % | Face Value | 2.00 ₹ | DMA 50 | 293 ₹ | DMA 200 | 278 ₹ |
| Chg in FII Hold | -5.55 % | Chg in DII Hold | 1.81 % | PAT Qtr | 376 Cr. | PAT Prev Qtr | 381 Cr. |
| RSI | 67.6 | MACD | 10.4 | Volume | 53,52,769 | Avg Vol 1Wk | 63,67,922 |
| Low price | 229 ₹ | High price | 327 ₹ | PEG Ratio | 2.81 | Debt to equity | 3.21 |
| 52w Index | 97.6 % | Qtr Profit Var | -9.37 % | EPS | 18.0 ₹ | Industry PE | 18.3 |
📊 Core Financials: Manappuram Finance reported quarterly PAT of ₹376 Cr (slightly down from ₹381 Cr), showing stable but pressured profitability. ROE at 11.0% and ROCE at 9.53% reflect modest efficiency. Debt-to-equity ratio of 3.21 indicates high leverage, typical for NBFCs. EPS at ₹18.0 is modest relative to market cap, highlighting limited earnings expansion.
💹 Valuation Indicators: Stock P/E of 18.0 is nearly in line with industry average (18.3), suggesting fair valuation. Book value at ₹188 vs CMP ₹325 shows a reasonable premium. PEG ratio of 2.81 indicates earnings growth is slower relative to valuation. Intrinsic value appears supportive of long-term holding, though leverage risk persists.
🏦 Business Model & Advantage: Manappuram operates as a non-banking financial company (NBFC), focusing on gold loans, microfinance, and vehicle financing. Competitive advantage lies in strong rural presence, gold-backed lending, and diversified financial services. However, asset quality and high leverage remain key risks.
📈 Entry Zone & Holding Guidance: The stock trades near its 52-week high (₹327) and above DMA 50 (₹293) and DMA 200 (₹278), showing strong momentum. RSI at 67.6 indicates overbought conditions. A better entry zone would be closer to ₹290–₹310. Long-term holding is viable given strong rural demand and gold loan business, but investors should monitor leverage and asset quality.
Positive
- ✅ Strong rural and gold loan financing presence
- ✅ Dividend yield at 1.08%, providing income support
- ✅ DII holding increased by 1.81%, showing domestic institutional confidence
Limitation
- ⚠️ High debt-to-equity ratio (3.21), leverage risk
- ⚠️ ROCE (9.53%) and ROE (11.0%) reflect modest efficiency
- ⚠️ PEG ratio of 2.81, showing slower earnings growth relative to valuation
Company Negative News
- 📉 FII holding decreased by 5.55%, showing reduced foreign investor confidence
Company Positive News
- 📈 Quarterly profit variation of 55% year-on-year indicates strong operational momentum
- 📈 Stable PAT despite sector challenges
Industry
- 🌐 NBFC industry PE at 18.3, reflecting moderate valuations
- 🌐 Long-term demand supported by rural credit growth and gold-backed lending
Conclusion
🔎 Manappuram Finance is moderately efficient with strong rural presence and fair valuation relative to peers. Entry near ₹290–₹310 offers better risk-reward. Long-term investors may hold cautiously, supported by rural demand and gold loan business, but leverage and asset quality risks must be monitored.
For deeper insights, you could explore a peer comparison or a valuation analysis to assess its position against competitors and intrinsic value.