NUVAMA - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.6

📊 Core Financials Overview

Profitability

PAT surged from ₹27.5 Cr to ₹221 Cr — a massive 376% quarterly jump, signaling strong operational leverage.

EPS: ₹216 — exceptional, reflecting high earnings efficiency.

Return Metrics

ROCE: 30.6% and ROE: 32.6% — both outstanding, indicating superior capital deployment and shareholder value creation.

Debt Profile

Debt-to-equity: 0.39 — moderate and well-managed, typical for diversified financial services.

Cash Flow: Not disclosed, but strong earnings and moderate debt suggest robust operating cash flows.

💹 Valuation Indicators

Metric Value Commentary

P/E Ratio 29.9 Fairly valued vs. industry average of 15.9 — reflects premium positioning.

P/B Ratio ~11.9 Elevated — justified by high ROE and brand strength.

PEG Ratio 0.21 Very attractive — indicates undervaluation relative to growth.

Intrinsic Value Estimated near ₹6,900–₹7,200 Current price of ₹6,406 is slightly below fair value — favorable entry point.

🧠 Business Model & Competitive Advantage

Nuvama Wealth Management Ltd. (formerly Edelweiss Securities) is India’s second-largest independent wealth manager

Core Segments

Wealth Management: Serves UHNIs, HNIs, and affluent clients via Nuvama Private and Nuvama Wealth divisions.

Capital Markets: Institutional broking, debt advisory, merchant banking, and clearing services.

Asset Management: PMS, AIFs, and proprietary products — growing rapidly.

Client Assets

₹4.41 lakh Cr as of Sep 2024 — diversified across equity, fixed income, alternates, and structured products.

Strategic Strengths

Deep client relationships and hybrid advisory models.

Strong digital infrastructure and cost-to-income ratio improvement (from 73% in FY21 to 54% in H1FY25).

Yields on assets exceed 90 bps — nearly double that of mutual funds

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Its competitive edge lies in multi-channel distribution, high-yield asset mix, and scalable advisory platforms, positioning it to capitalize on India’s structural wealth creation boom.

📈 Technical & Sentiment Signals

RSI: 41.5 — approaching oversold zone, potential for rebound.

MACD: Negative — short-term bearish momentum.

Volume: Below average — suggests consolidation.

DMA 50/200: Price below both — short-term weakness, long-term support near ₹6,542.

🎯 Entry Zone & Long-Term Guidance

Suggested Entry Zone: ₹6,200–₹6,400 — near current levels and below DMA resistance.

Long-Term View: NUVAMA is a high-quality financial services stock with strong fundamentals, scalable business model, and exposure to India’s rising affluence. Suitable for long-term holding, especially for investors seeking exposure to wealth management and capital markets. Dividend yield of 2.26% adds income support.

You can explore Nuvama’s business model and future plans for deeper insights

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. Let me know if you'd like a comparison with IIFL Wealth or Anand Rathi.

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tradebrains.in

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forum.valuepickr.com

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www.thehindubusinessline.com

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