CREDITACC - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 2.6

💳 Fundamental Analysis: CreditAccess Grameen Ltd. (CREDITACC)

CreditAccess operates in the microfinance space, serving rural and semi-urban borrowers. While it plays a vital role in financial inclusion, its current valuation and weak capital efficiency raise concerns for long-term investors.

Metric Value Implication

Market Cap ₹19,782 Cr Mid-cap; niche financial services

Stock P/E 102 Extremely expensive vs. industry PE of 55.3

PEG Ratio 6.99 Severely overvalued relative to growth

ROCE / ROE 9.55% / 7.86% Weak capital efficiency; below ideal for long-term compounding

Dividend Yield 0.81% Low; not attractive for income investors

Debt-to-Equity 2.94 High leverage; typical for NBFCs but adds risk

EPS ₹12.2 Low earnings base relative to price

Qtr Profit Var -84.9% Sharp decline; earnings volatility is high

FII/DII Holding Change +0.75% / +0.09% Mild accumulation; cautious optimism

📉 Technical Analysis

Current Price: ₹1,238

DMA 50 / DMA 200: ₹1,227 / ₹1,137 → Trading slightly above both; neutral to mildly bullish

RSI: 45.7 → Balanced; no strong momentum

MACD: +21.4 → Mild bullish crossover

Volume: Well below average; waning interest

💰 Ideal Entry Price Zone

₹1,050–₹1,150

This range offers better risk-reward and aligns with DMA 200 support

Avoid fresh entry above ₹1,250 unless PEG ratio compresses and ROE improves

📈 Long-Term Investment Outlook

Strengths

Plays a vital role in financial inclusion

FII accumulation — some institutional confidence

Recent PAT improvement — signs of recovery

Risks

PEG > 6.5 — severely overvalued for current growth

ROE and ROCE below 10% — weak long-term wealth creation potential

High debt-to-equity — leverage risk in volatile credit cycles

Profit volatility — recent 85% drop is a red flag

CreditAccess is a high-risk, high-volatility financial stock. Long-term potential depends on consistent earnings recovery and improved capital efficiency.

🏁 Exit Strategy / Holding Period

If you already hold CREDITACC

Holding Period: 1–2 years, with close monitoring of quarterly results

Exit Strategy

Consider trimming near ₹1,350–₹1,400 (recent high)

Reassess if ROE stays below 10% and PEG remains above 4

Hold only if earnings stabilize and asset quality improves

Would you like a comparison with other microfinance or NBFC players like Spandana Sphoorty or Ujjivan Financial to explore better alternatives?

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