Check Before You Invest : Avon Mercantile Ltd

BSE: 512265 NSE: ISIN: INE471D01019

| Sector: BFSI | Industry: Finance - Investment

Snapshot

Q.1 Which industry/sub-sector does Avon Mercantile Ltd belong to?

Avon Mercantile Ltd belongs to the BFSI sector, operating specifically within the Finance - Investment segment.

Q.2 Is Avon Mercantile Ltd a good quality company?

Avon Mercantile Ltd is a quality company, based on a 10-year financial track record.

Q.3 Is Avon Mercantile Ltd undervalued or overvalued?

Avon Mercantile Ltd appears Undervalued, as its key valuation ratios are below with their past averages.

Q.4 Is Avon Mercantile Ltd a good buy now?

Avon Mercantile Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Total Income growth of Avon Mercantile Ltd?

Avon Mercantile Ltd Operating Income growth is -41.24% for FY-2025, which is below its 5-year CAGR of -16.09%, indicating slower growth.

Q.2 Return on Assets of Avon Mercantile Ltd?

Avon Mercantile Ltd Return on Asset is -0.1%, which is above its 5-year historical median of -2.7%, indicating improved earnings on assets.

	Current Level	5-year Historic Median
NPM%	-0.55	-30.28
PPOP%	-13.33	-67.35
RoA%	-0.1	-2.7

Q.3 Return on Equity (ROE) of Avon Mercantile Ltd?

Avon Mercantile Ltd Return on Equity is -0.3% for FY-2025, which is above its 5-year historical median of -17.5%, indicating the business is making better use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of Avon Mercantile Ltd?

Avon Mercantile Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is -13.33% for FY-2025, which is above its 5-year median(-67.35%), indicating increasing margins.

Q.5 Net Profit Margin of Avon Mercantile Ltd?

Avon Mercantile Ltd Net Profit Margin, which is the difference between the rate of interest earned on assets and the rate of interest paid on liabilities, is -0.55% for FY-2025, which is above its 5-year median( -30.28%), indicating increasing margins.

Q.6 Total Asset growth of Avon Mercantile Ltd?

Avon Mercantile Ltd Total Asset growth is 519.81% for FY-2025, which is above its 5-year CAGR of -6.24%, indicating faster growth.

Q.7 Capital Adequacy ratio of Avon Mercantile Ltd?

Avon Mercantile Ltd Capital Adequacy ratio (CAR) is 12.9% for FY-2025, which is below the regulatory requirement of 15%, indicating adequate capital position.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Avon Mercantile Ltd?

Promoters hold 26.21% of the Avon Mercantile Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 AUM Growth of Avon Mercantile Ltd vs Industry Peers?

Avon Mercantile Ltd AUM CAGR is -6.24%, compared to the 5-year industry median CAGR of 9.45%, indicating slower growth and losing its market share.

Q.2 Profit metrics (NPM, PPOP, RoA) of Avon Mercantile Ltd vs industry peers

Avon Mercantile Ltd profit metrics are in line with the industry median level of -0.88%, indicating similar profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM%	-0.55	9.95
PPOP%	-13.33	-13.4
RoA%	-0.1	0.8

Q.3 Operating efficiency of Avon Mercantile Ltd vs industry peers?

Avon Mercantile Ltd ROCE (6.2) is above the industry median of (1.9); while the current ROE (-17.5) are below than the 5-year average Industry ROE (1.2). This shows that the business is positioned in the middle quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM%	-0.55	9.95
PPOP%	-13.33	-13.4
RoA%	-0.1	0.8
ROCE%	7.3	1.9
ROE%	-0.3	1.2

Valuation & price assessment

Q.1 Stock return of Avon Mercantile Ltd over the last decade?

Over the last - years, the stock has delivered a CAGR of N/A% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	-	-	-	-

Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	-	-	33.72
Price to Book	-	-	0.94
Price to Sales	-	-	12.44
EV to EBITDA	-	-	9.97

Q.4 Valuation ratios of Avon Mercantile Ltdvs historical and industry averages?

The current Price to book ratio (P/B) 0% is similar than its historical median of %, indicating that at the current price the stock is fairly valued. However, you need a deeper analysis to make a better judgement.

Strategic outlook

Q.1 Does its ROIC exceed its WACC?

Avon Mercantile Ltd return on invested capital (ROIC) is 5.09% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

Check more companies

1. Cholamandalam Fin.

2. TVS Holdings

3. Capri Global Capital

4. Maharashtra Scooters

9. Religare Enterprises

10. Pilani Investment

Check trending companies

1. RR Kabel Ltd.

2. LTM Ltd.

3. Blue Star Ltd.

4. Voltas Ltd.

5. Aarti Industries Ltd.