Check Before You Invest : Dhruva Capital Services Ltd

Snapshot

Q.1 Which industry/sub-sector does Dhruva Capital Services Ltd belong to?

Dhruva Capital Services Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q.2 Is Dhruva Capital Services Ltd a good quality company?

Dhruva Capital Services Ltd is a weak quality company, based on a inconsistent 10-year financial track record.

Q.3 Is Dhruva Capital Services Ltd undervalued or overvalued?

Dhruva Capital Services Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.

Q.4 Is Dhruva Capital Services Ltd a good buy now?

Dhruva Capital Services 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 Dhruva Capital Services Ltd?

Dhruva Capital Services Ltd Operating Income growth is 85.22% for FY-2025, which is above its 5-year CAGR of 58.94%, indicating faster growth.

Q.2 Return on Assets of Dhruva Capital Services Ltd?

Dhruva Capital Services Ltd Return on Asset is 7.7%, which is above its 5-year historical median of 1.9%, indicating improved earnings on assets.

	Current Level	5-year Historic Median
NPM%	59.23	37.57
PPOP%	-	-
RoA%	7.7	1.9

Q.3 Return on Equity (ROE) of Dhruva Capital Services Ltd?

Dhruva Capital Services Ltd Return on Equity is 10.9% for FY-2025, which is above its 5-year historical median of 2.1%, indicating the business is making better use of its shareholders capital.

Q.4 Net Profit Margin of Dhruva Capital Services Ltd?

Dhruva Capital Services 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 59.23% for FY-2025, which is above its 5-year median( 37.57%), indicating increasing margins.

Q.5 Total Asset growth of Dhruva Capital Services Ltd?

Dhruva Capital Services Ltd Total Asset growth is 66.67% for FY-2025, which is above its 5-year CAGR of 31.95%, indicating faster growth.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Dhruva Capital Services Ltd?

Promoters hold 45.91% of the Dhruva Capital Services Ltd, with 32.72% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 AUM Growth of Dhruva Capital Services Ltd vs Industry Peers?

Dhruva Capital Services Ltd AUM CAGR is 31.95%, compared to the 5-year industry median CAGR of 9.9%, indicating faster growth and gaining its market share.

Q.2 Profit metrics (NPM, PPOP, RoA) of Dhruva Capital Services Ltd vs industry peers

Dhruva Capital Services Ltd profit metrics are in line with the industry median level of 7.31%, indicating similar profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM%	59.23	15.95
PPOP%	-	4.54
RoA%	7.7	1.45

Q.3 Operating efficiency of Dhruva Capital Services Ltd vs industry peers?

Dhruva Capital Services Ltd ROCE (2.1) is below the industry median of (4.4); while the current ROE (2.1) are below than the 5-year average Industry ROE (2.7). This shows that the business is positioned in the bottom quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM%	59.23	15.95
PPOP%	-	4.54
RoA%	7.7	1.45
ROCE%	12.5	4.4
ROE%	10.9	2.7

Valuation & price assessment

Q.1 Stock return of Dhruva Capital Services Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 45.7% based on the current price.

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

	9Y	5Y	3Y	1Y
Share Price CAGR	45.7%	182.2%	85.5%	116.1%

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	155	59.22	28.96
Price to Book	8.13	3.51	1.11
Price to Sales	80.71	46.08	9.10
EV to EBITDA	61.15	52.63	11.77

Q.4 Valuation ratios of Dhruva Capital Services Ltdvs historical and industry averages?

The current Price to book ratio (P/B) 8.13% is higher than its historical median of 3.51%, indicating that at the current price the stock is overvalued. However, you need a deeper analysis to make a better judgement.

Strategic outlook

Q.1 Does its ROIC exceed its WACC?

Dhruva Capital Services Ltd return on invested capital (ROIC) is 9.22% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

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