Check Before You Invest : Optimus Finance Ltd

Snapshot

Q.1 Which industry/sub-sector does Optimus Finance Ltd belong to?

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

Q.2 Is Optimus Finance Ltd a good quality company?

Optimus Finance Ltd is a quality company, based on a 10-year financial track record.

Q.3 Is Optimus Finance Ltd undervalued or overvalued?

Optimus Finance Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.

Q.4 Is Optimus Finance Ltd a good buy now?

Optimus Finance 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 Optimus Finance Ltd?

Optimus Finance Ltd Operating Income growth is 16.41% for FY-2025, which is above its 5-year CAGR of 6.26%, indicating faster growth.

Q.2 Return on Assets of Optimus Finance Ltd?

Optimus Finance Ltd Return on Asset is 2.5%, which is above its 5-year historical median of 0.7%, indicating improved earnings on assets.

	Current Level	5-year Historic Median
NPM%	35.79	16.31
PPOP%	-78.27	-78.27
RoA%	2.5	0.7

Q.3 Return on Equity (ROE) of Optimus Finance Ltd?

Optimus Finance Ltd Return on Equity is 2.6% for FY-2025, which is above its 5-year historical median of 0.8%, indicating the business is making better use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of Optimus Finance Ltd?

Optimus Finance Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is -78.27% for FY-2025, which is in line with its 5-year median(-78.27%), indicating stable margins.

Q.5 Net Profit Margin of Optimus Finance Ltd?

Optimus Finance 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 35.79% for FY-2025, which is above its 5-year median( 16.31%), indicating increasing margins.

Q.6 Total Asset growth of Optimus Finance Ltd?

Optimus Finance Ltd Total Asset growth is 2.52% for FY-2025, which is below its 5-year CAGR of 11.78%, indicating slower growth.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Optimus Finance Ltd?

Promoters hold 53.89% of the Optimus Finance Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 AUM Growth of Optimus Finance Ltd vs Industry Peers?

Optimus Finance Ltd AUM CAGR is 11.78%, 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 Optimus Finance Ltd vs industry peers

Optimus Finance 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%	35.79	15.95
PPOP%	-78.27	4.54
RoA%	2.5	1.45

Q.3 Operating efficiency of Optimus Finance Ltd vs industry peers?

Optimus Finance Ltd ROCE (1.6) is below the industry median of (4.4); while the current ROE (0.8) 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%	35.79	15.95
PPOP%	-78.27	4.54
RoA%	2.5	1.45
ROCE%	3.6	4.4
ROE%	2.6	2.7

Valuation & price assessment

Q.1 Stock return of Optimus Finance Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 15% based on the current price.

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

	9Y	5Y	3Y	1Y
Share Price CAGR	15%	39.7%	12.8%	-45.1%

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	233.73	250.87	28.96
Price to Book	4.2	3.48	1.11
Price to Sales	66.36	70.85	9.10
EV to EBITDA	159.99	179.96	11.77

Q.4 Valuation ratios of Optimus Finance Ltdvs historical and industry averages?

The current Price to book ratio (P/B) 4.2% is higher than its historical median of 3.48%, 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?

Optimus Finance Ltd return on invested capital (ROIC) is 2.65% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

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