Check Before You Invest : United Credit Ltd

Q: Which industry/sub-sector does United Credit Ltd belong to?

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

Q: Is United Credit Ltd a good quality company?

United Credit Ltd is a quality company, based on a 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 United Credit Ltd undervalued or overvalued?

United Credit Ltd appears Somewhat 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: 21.64, Historic Median: 10.19. Price to Book, Current: 0.49, Historic Median: 0.35. Price to Sales, Current: 5.86, Historic Median: 4.49. EV to EBITDA, Current: 15.71, Historic Median: 7.24

Q: Is United Credit Ltd a good buy now?

United Credit 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 United Credit Ltd?

United Credit Ltd Operating Income growth is 1.18% for FY-2025, which is below its 5-year CAGR of 3.5%, indicating slower growth.

Q: Return on Assets of United Credit Ltd?

United Credit Ltd Return on Asset is 3.4%, which is above its 5-year historical median of 3.2%, indicating improved earnings on assets. Efficiency & Key Metrics. NPM (%), Current: 29.51, Historic Median: 29.51. PPOP (%), Current: -24.4, Historic Median: 3.31. RoA (%), Current: 3.4, Historic Median: 3.2

Q: Return on Equity (ROE) of United Credit Ltd?

United Credit Ltd Return on Equity is 3.5% for FY-2025, which is in line with its 5-year historical median of 3.5%, indicating the business is making similar use of its shareholders capital.

Q: Pre-provisioning operating profit margin of United Credit Ltd?

United Credit Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is -24.4% for FY-2025, which is below its 5-year median(3.31%), indicating decreasing margins.

Q: Net Profit Margin of United Credit Ltd?

United Credit 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 29.51% for FY-2025, which is in line with its 5-year median( 29.51%), indicating stable margins.

Q: Does its ROIC exceed its WACC?

United Credit Ltd return on invested capital (ROIC) is 3.45% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 14%, indicating value erosion.

Snapshot

Q.1 Which industry/sub-sector does United Credit Ltd belong to?

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

Q.2 Is United Credit Ltd a good quality company?

United Credit Ltd is a quality company, based on a 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 United Credit Ltd undervalued or overvalued?

United Credit Ltd appears Somewhat 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	21.64	10.19
Price to Book	0.49	0.35
Price to Sales	5.86	4.49
EV to EBITDA	15.71	7.24

Q.4 Is United Credit Ltd a good buy now?

United Credit 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 United Credit Ltd?

United Credit Ltd Operating Income growth is 1.18% for FY-2025, which is below its 5-year CAGR of 3.5%, indicating slower growth.

Q.2 Return on Assets of United Credit Ltd?

United Credit Ltd Return on Asset is 3.4%, which is above its 5-year historical median of 3.2%, indicating improved earnings on assets.

	Current Level	5-year Historic Median
NPM (%)	29.51	29.51
PPOP (%)	-24.4	3.31
RoA (%)	3.4	3.2

Q.3 Return on Equity (ROE) of United Credit Ltd?

United Credit Ltd Return on Equity is 3.5% for FY-2025, which is in line with its 5-year historical median of 3.5%, indicating the business is making similar use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of United Credit Ltd?

United Credit Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is -24.4% for FY-2025, which is below its 5-year median(3.31%), indicating decreasing margins.

Q.5 Net Profit Margin of United Credit Ltd?

United Credit 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 29.51% for FY-2025, which is in line with its 5-year median( 29.51%), indicating stable margins.

Q.6 Does its ROIC exceed its WACC?

United Credit Ltd return on invested capital (ROIC) is 3.45% 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.7 Total Asset growth of United Credit Ltd?

United Credit Ltd Total Asset growth is 1.91% for FY-2025, which is below its 5-year CAGR of 2.35%, indicating slower growth.

Ownership & governance

D: Promoter shareholding and pledge status of United Credit Ltd?

Q.1 Promoter shareholding and pledge status of United Credit Ltd?

Promoters hold 57.31% of the United Credit Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does United Credit Ltd performance compare with that of its Peers?

Q.1 AUM Growth of United Credit Ltd vs Industry Peers?

United Credit Ltd AUM CAGR is 2.35%, compared to the 5-year industry median CAGR of 9.71%, indicating slower growth and losing its market share.

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

United Credit Ltd profit metrics are in line with the industry median level of 4.76%, indicating similar profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM (%)	29.51	12.87
PPOP (%)	-24.4	-
RoA (%)	3.4	1.4

Q.3 Operating efficiency of United Credit Ltd vs industry peers?

United Credit Ltd ROCE (4.7) is above the industry median of (4.15); while the current ROE (3.5) are above than the 5-year average Industry ROE (2.3). This shows that the business is positioned in the top quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM (%)	29.51	12.87
PPOP (%)	-24.4	-
RoA (%)	3.4	1.4
ROCE (%)	4.4	4.15
ROE (%)	3.5	2.3

Valuation & price assessment

Q.1 Stock return of United Credit Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 8.3% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	8.3%	22.1%	24.8%	-14.7%

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	21.64	10.19	29.12
Price to Book	0.49	0.35	1.11
Price to Sales	5.86	4.49	9.10
EV to EBITDA	15.71	7.24	11.77

Q.3 Valuation ratios of United Credit Ltd vs historical and industry averages?

The current Price-to-Book (P/B) ratio of 0.49 is higher than its historical median of 0.35, indicating that the stock is trading above its historical average valuation.

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