Check Before You Invest : India Finsec Ltd

Q: Which industry/sub-sector does India Finsec Ltd belong to?

India Finsec Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q: Is India Finsec Ltd a good quality company?

India Finsec Ltd is a weak quality company, based on a inconsistent multi-year financial track record. This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q: Is India Finsec Ltd undervalued or overvalued?

India Finsec Ltd appears Overvalued, as its key valuation ratios are higher than their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: -, Historic Median: -. Price to Book, Current: 7.05, Historic Median: 2.86. Price to Sales, Current: 15846.93, Historic Median: 420.32. EV to EBITDA, Current: 10069.12, Historic Median: 275.48

Q: Is India Finsec Ltd a good buy now?

India Finsec 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

Q: Total Income growth of India Finsec Ltd?

India Finsec Ltd Operating Income growth is -36.45% for FY-2025, which is in line with its 5-year CAGR of -38.1%, indicating stable growth.

Q: Return on Assets of India Finsec Ltd?

India Finsec Ltd Return on Asset is 0%, which is below its 5-year historical median of 0.3%, indicating deteriorated earnings on assets. Efficiency & Key Metrics. NPM (%), Current: 0.41, Historic Median: 3.81. PPOP (%), Current: -, Historic Median: -. RoA (%), Current: -, Historic Median: 0.3

Q: Return on Equity (ROE) of India Finsec Ltd?

India Finsec Ltd Return on Equity is 0% for FY-2025, which is below its 5-year historical median of 0.3%, indicating the business is making worse use of its shareholders capital.

Q: Net Profit Margin of India Finsec Ltd?

India Finsec 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 0.41% for FY-2025, which is below its 5-year median( 3.81%), indicating decreasing margins.

Q: Does its ROIC exceed its WACC?

India Finsec Ltd return on invested capital (ROIC) is 0.1% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

Q: Total Asset growth of India Finsec Ltd?

India Finsec Ltd Total Asset growth is 71.74% for FY-2025, which is above its 5-year CAGR of 11.91%, indicating faster growth.

Snapshot

Q.1 Which industry/sub-sector does India Finsec Ltd belong to?

India Finsec Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q.2 Is India Finsec Ltd a good quality company?

India Finsec Ltd is a weak quality company, based on a inconsistent multi-year financial track record.

This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q.3 Is India Finsec Ltd undervalued or overvalued?

India Finsec Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	-	-
Price to Book	7.05	2.86
Price to Sales	15846.93	420.32
EV to EBITDA	10069.12	275.48

Q.4 Is India Finsec Ltd a good buy now?

India Finsec 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

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Total Income growth, NPM, PPOP, RoA and RoE compared to its last 5-year median.
How efficiently has it grown and managed operations?
By checking its Total Asset growth.
How strong is its Capital position and Asset Quality?
By checking its Capital Adequacy Ratio (CAR), GNPA and NNPA.

A: What are the trends in income and profitability?

Q.1 Total Income growth of India Finsec Ltd?

India Finsec Ltd Operating Income growth is -36.45% for FY-2025, which is in line with its 5-year CAGR of -38.1%, indicating stable growth.

Q.2 Return on Assets of India Finsec Ltd?

India Finsec Ltd Return on Asset is 0%, which is below its 5-year historical median of 0.3%, indicating deteriorated earnings on assets.

	Current Level	5-year Historic Median
NPM (%)	0.41	3.81
PPOP (%)	-	-
RoA (%)	-	0.3

Q.3 Return on Equity (ROE) of India Finsec Ltd?

India Finsec Ltd Return on Equity is 0% for FY-2025, which is below its 5-year historical median of 0.3%, indicating the business is making worse use of its shareholders capital.

Q.4 Net Profit Margin of India Finsec Ltd?

India Finsec 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 0.41% for FY-2025, which is below its 5-year median( 3.81%), indicating decreasing margins.

Q.5 Does its ROIC exceed its WACC?

India Finsec Ltd return on invested capital (ROIC) is 0.1% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

B: Does the bank grow efficiently and manage its operating costs?

Q.6 Total Asset growth of India Finsec Ltd?

India Finsec Ltd Total Asset growth is 71.74% for FY-2025, which is above its 5-year CAGR of 11.91%, indicating faster growth.

C: How strong is the bank’s capital position and asset quality?

Q.7 Capital Adequacy ratio of India Finsec Ltd?

India Finsec Ltd Capital Adequacy ratio (CAR) is 0.3% for FY-2025, which is below the regulatory requirement of 15%, indicating adequate capital position.

Ownership & governance

D: Promoter shareholding and pledge status of India Finsec Ltd?

Q.1 Promoter shareholding and pledge status of India Finsec Ltd?

Promoters hold 55.98% of the India Finsec Ltd, with 71.10% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

E: How does India Finsec Ltd performance compare with that of its Peers?

Q.1 AUM Growth of India Finsec Ltd vs Industry Peers?

India Finsec Ltd AUM CAGR is 11.91%, compared to the 5-year industry median CAGR of 9.68%, indicating faster growth and gaining its market share.

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

India Finsec Ltd profit metrics are in line with the industry median level of 4.73%, indicating similar profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM (%)	0.41	12.79
PPOP (%)	-	-
RoA (%)	-	1.4

Q.3 Operating efficiency of India Finsec Ltd vs industry peers?

India Finsec Ltd ROCE (0.6) is below the industry median of (4.1); while the current ROE (0.3) are below than the 5-year average Industry ROE (2.2). This shows that the business is positioned in the bottom quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM (%)	0.41	12.79
PPOP (%)	-	-
RoA (%)	-	1.4
ROCE (%)	0.2	4.1
ROE (%)	-	2.2

Valuation & price assessment

Q.1 Stock return of India Finsec Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 39.4% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	39.4%	65.4%	84.5%	31%

Q.2 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	-	-	29.12
Price to Book	7.05	2.86	1.11
Price to Sales	15846.93	420.32	9.10
EV to EBITDA	10069.12	275.48	11.77

Q.3 Valuation ratios of India Finsec Ltd vs historical and industry averages?

The current Price-to-Book (P/B) ratio of 7.05 is higher than its historical median of 2.86, indicating that the stock is trading above its historical average valuation.

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