Check Before You Invest : NCL Research & Financial Services Ltd

Snapshot

Q.1 Which industry/sub-sector does NCL Research & Financial Services Ltd belong to?

NCL Research & Financial Services Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q.2 Is NCL Research & Financial Services Ltd a good quality company?

NCL Research & Financial Services Ltd is a quality company, based on a 10-year financial track record.

Q.3 Is NCL Research & Financial Services Ltd undervalued or overvalued?

NCL Research & Financial Services Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Q.4 Is NCL Research & Financial Services Ltd a good buy now?

NCL Research & Financial 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 NCL Research & Financial Services Ltd?

NCL Research & Financial Services Ltd Operating Income growth is -19.98% for FY-2025, which is below its 5-year CAGR of 28.55%, indicating slower growth.

Q.2 Return on Assets of NCL Research & Financial Services Ltd?

NCL Research & Financial Services Ltd Return on Asset is -1.1%, which is below its 5-year historical median of 0.6%, indicating deteriorated earnings on assets.

	Current Level	5-year Historic Median
NPM%	-15.93	15.11
PPOP%	15.29	15.29
RoA%	-1.1	0.6

Q.3 Return on Equity (ROE) of NCL Research & Financial Services Ltd?

NCL Research & Financial Services Ltd Return on Equity is -1.2% for FY-2025, which is below its 5-year historical median of 0.6%, indicating the business is making worse use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of NCL Research & Financial Services Ltd?

NCL Research & Financial Services Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is 15.29% for FY-2025, which is in line with its 5-year median(15.29%), indicating stable margins.

Q.5 Net Profit Margin of NCL Research & Financial Services Ltd?

NCL Research & Financial 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 -15.93% for FY-2025, which is below its 5-year median( 15.11%), indicating decreasing margins.

Q.6 Total Asset growth of NCL Research & Financial Services Ltd?

NCL Research & Financial Services Ltd Total Asset growth is 9.72% for FY-2025, which is below its 5-year CAGR of 14.62%, indicating slower growth.

Ownership & governance

Q.1 Promoter shareholding and pledge status of NCL Research & Financial Services Ltd?

Promoters hold 0.00% of the NCL Research & Financial Services Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 AUM Growth of NCL Research & Financial Services Ltd vs Industry Peers?

NCL Research & Financial Services Ltd AUM CAGR is 14.62%, 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 NCL Research & Financial Services Ltd vs industry peers

NCL Research & Financial 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%	-15.93	15.95
PPOP%	15.29	4.54
RoA%	-1.1	1.45

Q.3 Operating efficiency of NCL Research & Financial Services Ltd vs industry peers?

NCL Research & Financial Services Ltd ROCE (1.35) is below the industry median of (4.4); while the current ROE (0.6) 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%	-15.93	15.95
PPOP%	15.29	4.54
RoA%	-1.1	1.45
ROCE%	-0.6	4.4
ROE%	-1.2	2.7

Valuation & price assessment

Q.1 Stock return of NCL Research & Financial Services Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of -17% based on the current price.

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

	9Y	5Y	3Y	1Y
Share Price CAGR	-17%	33%	7.7%	-18%

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	16.76	53.15	28.96
Price to Book	0.46	0.59	1.11
Price to Sales	6.78	16.24	9.10
EV to EBITDA	12.28	33.04	11.77

Q.4 Valuation ratios of NCL Research & Financial Services Ltdvs historical and industry averages?

The current Price to book ratio (P/B) 0.46% is lower than its historical median of 0.59%, indicating that at the current price the stock is undervalued. However, you need a deeper analysis to make a better judgement.

Strategic outlook

Q.1 Does its ROIC exceed its WACC?

NCL Research & Financial Services Ltd return on invested capital (ROIC) is -1.2% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

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