Check Before You Invest : TruCap Finance Ltd

BSE: 540268 NSE: TRU ISIN: INE615R01029

| Sector: BFSI | Industry: Finance Term Lending

Snapshot

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

TruCap Finance Ltd belongs to the BFSI sector, operating specifically within the Finance Term Lending segment.

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

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

Q.3 Is TruCap Finance Ltd undervalued or overvalued?

TruCap Finance Ltd appears Somewhat Undervalued, as its key valuation ratios are below with their past averages.

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

TruCap 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 TruCap Finance Ltd?

TruCap Finance Ltd Operating Income growth is 21.95% for FY-2025, which is below its 5-year CAGR of 59.38%, indicating slower growth.

Q.2 Return on Assets of TruCap Finance Ltd?

TruCap Finance Ltd Return on Asset is -8.3%, which is below its 5-year historical median of 1%, indicating deteriorated earnings on assets.

	Current Level	5-year Historic Median
NPM%	-33.91	4.47
PPOP%	-104.6	-8.22
RoA%	-8.3	1

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

TruCap Finance Ltd Return on Equity is -37.7% for FY-2025, which is below its 5-year historical median of 2.9%, indicating the business is making worse use of its shareholders capital.

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

TruCap Finance Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is -104.6% for FY-2025, which is below its 5-year median(-8.22%), indicating decreasing margins.

Q.5 Net Profit Margin of TruCap Finance Ltd?

TruCap 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 -33.91% for FY-2025, which is below its 5-year median( 4.47%), indicating decreasing margins.

Q.6 Total Asset growth of TruCap Finance Ltd?

TruCap Finance Ltd Total Asset growth is -26.07% for FY-2025, which is below its 5-year CAGR of 68.9%, indicating slower growth.

Q.7 Capital Adequacy ratio of TruCap Finance Ltd?

TruCap Finance Ltd Capital Adequacy ratio (CAR) is 23.6% for FY-2025, which is above the regulatory requirement of 15%, indicating strong capital position.

Q.8 Asset Quality of TruCap Finance Ltd?

TruCap Finance Ltd Gross Non-Performing Assets, which are loans overdue by more than 90 days, is 3.69% for FY-2025, which is above its 5-year median 3.02%, while Net Non-Performing Assets, which is GNPA minus provisions made for bad loans is 2.17% which is above its 5-year median( 2.02%), indicating deteriorating asset quality.

Ownership & governance

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

Promoters hold 30.96% of the TruCap Finance Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

TruCap Finance Ltd AUM CAGR is 68.9%, compared to the 5-year industry median CAGR of 3.91%, indicating faster growth and gaining its market share.

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

TruCap Finance Ltd profit metrics are in line with the industry median level of 3.13%, indicating similar profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM%	-33.91	4.47
PPOP%	-104.6	3.91
RoA%	-8.3	1

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

TruCap Finance Ltd ROCE (10.3) is above the industry median of (9.28); while the current ROE (2.9) are below than the 5-year average Industry ROE (5.8). This shows that the business is positioned in the middle quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM%	-33.91	4.47
PPOP%	-104.6	3.91
RoA%	-8.3	1
ROCE%	2.5	9.28
ROE%	-37.7	5.8

Valuation & price assessment

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

Over the last 5 years, the stock has delivered a CAGR of -45.68% 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%	-49.4%	-9.5%

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	-	101.33	13.28
Price to Book	1.12	2.88	1.13
Price to Sales	0.72	5.36	4.77
EV to EBITDA	-2.31	14.78	10.31

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

The current Price to book ratio (P/B) 1.12% is lower than its historical median of 2.88%, 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?

TruCap Finance Ltd return on invested capital (ROIC) is 0.31% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

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