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Last Updated on: 21 November, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 534804 | NSE: CARERATING

CARE Ratings Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: November 21, 2024, 10:21 pm

Market Cap 4,065 Cr.
Current Price 1,364
High / Low1,571/891
Stock P/E35.5
Book Value 252
Dividend Yield1.32 %
ROCE20.6 %
ROE14.5 %
Face Value 10.0
PEG Ratio13.21

Stock P/E, Current Price, and Intrinsic Value Over Time

View Share Price Target for CARE Ratings Ltd

Competitors of CARE Ratings Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
ICRA Ltd 5,973 Cr. 6,1857,735/4,98339.5 9891.62 %21.4 %15.6 % 10.0
CARE Ratings Ltd 4,065 Cr. 1,3641,571/89135.5 2521.32 %20.6 %14.5 % 10.0
Industry Average5,019.00 Cr3,774.5037.50620.501.47%21.00%15.05%10.00

All Competitor Stocks of CARE Ratings Ltd

Quarterly Result

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
Sales49765666558562786696799079
Expenses41434143384348504955556157
Operating Profit9341522164214271842232922
OPM %18%44%27%34%30%50%22%35%27%43%30%32%28%
Other Income76778812101211141012
Interest0000000100000
Depreciation2222233333333
Profit before tax14372027214823342650343630
Tax %17%28%25%15%33%27%28%41%31%29%30%32%30%
Net Profit12271523143516201836242521
EPS in Rs3.759.044.917.724.6111.575.386.605.9911.817.888.076.94

Last Updated: September 12, 2024, 5:01 pm

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: September 12, 2024, 5:01 pm

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024TTM
Sales203236261279287333319244248248279332344
Expenses6888101105105122144162153168180220228
Operating Profit13514816017418221117581968099112116
OPM %66%63%61%62%63%63%55%33%39%32%36%34%34%
Other Income2936449342530313127384747
Interest0010000110122
Depreciation3354333888111011
Profit before tax16018119717821223320210411999126147151
Tax %29%28%30%33%31%30%32%20%23%22%32%30%
Net Profit11413013812014816213883917785103106
EPS in Rs39.7844.6347.5340.6850.1355.1346.6627.9630.3925.3428.1233.6734.70
Dividend Payout %50%63%166%69%56%100%64%70%56%67%89%53%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)14.04%6.15%-13.04%23.33%9.46%-14.81%-39.86%9.64%-15.38%10.39%21.18%
Change in YoY Net Profit Growth (%)0.00%-7.88%-19.20%36.38%-13.87%-24.27%-25.04%49.49%-25.02%25.77%10.79%

CARE Ratings Ltd has shown an inconsistent trend in YoY Net Profit Growth (%) in the last 11 years from 2013-2014 to 2023-2024.

Growth

Compounded Sales Growth
10 Years:3%
5 Years:1%
3 Years:10%
TTM:21%
Compounded Profit Growth
10 Years:-1%
5 Years:-6%
3 Years:4%
TTM:29%
Stock Price CAGR
10 Years:-1%
5 Years:23%
3 Years:29%
1 Year:50%
Return on Equity
10 Years:20%
5 Years:14%
3 Years:13%
Last Year:14%

Last Updated: Unknown

Balance Sheet

Last Updated: November 15, 2024, 1:32 am

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024Sep 2024
Equity Capital29292929292929292930303030
Reserves396456330379491567521504559618643687724
Borrowings0000000079172021
Other Liabilities8496879464616485746980105119
Total Liabilities508581446502584658614618671725770842894
Fixed Assets58596564616083938596107109117
CWIP0000000138460
Investments38145933538146651843933924044444444
Other Assets69634658577993185343577614683732
Total Assets508581446502584658614618671725770842894

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity +831071071061191341096786688291
Cash from Investing Activity +-87-46157-41-22-258327-38-2713-39
Cash from Financing Activity +-40-62-276-66-96-99-195-107-43-35-63-63
Net Cash Flow-44-1-12-1111-4-135632-11

Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow135.00148.00160.00174.00182.00211.00175.0081.0089.0071.0082.0092.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days402322313243546131252725
Inventory Days
Days Payable
Cash Conversion Cycle402322313243546131252725
Working Capital Days-85-100-82-65-10-113141640641594
ROCE %37%36%39%46%44%41%35%19%21%16%19%21%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthSep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
FIIs21.13%23.18%25.74%17.47%18.14%17.99%20.03%20.25%20.90%21.67%22.91%23.37%
DIIs17.89%16.10%14.52%21.53%24.88%25.06%23.79%23.17%23.72%26.32%26.89%26.15%
Public60.98%60.72%59.74%61.00%56.99%56.94%56.16%56.57%55.38%51.99%50.20%50.47%
No. of Shareholders72,65871,89369,18671,42369,19664,90161,05059,50455,72154,53952,46853,140

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
Quant Active Fund117,5020.111.64117,5022024-11-120%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue10.0010.0010.0010.0010.00
Basic EPS (Rs.)33.7728.1725.4530.3827.96
Diluted EPS (Rs.)33.6728.1725.4530.3827.96
Cash EPS (Rs.)37.8732.3228.5133.5230.97
Book Value[Excl.RevalReserv]/Share (Rs.)242.72228.63220.20201.29182.11
Book Value[Incl.RevalReserv]/Share (Rs.)242.72228.63220.20201.29182.11
Revenue From Operations / Share (Rs.)111.1193.9483.5384.3382.70
PBDIT / Share (Rs.)53.2046.2236.0243.1338.28
PBIT / Share (Rs.)49.6942.6733.4240.4835.65
PBT / Share (Rs.)49.1242.3433.2740.2735.33
Net Profit / Share (Rs.)34.3628.7725.9130.8828.34
NP After MI And SOA / Share (Rs.)33.6728.1225.3330.3827.96
PBDIT Margin (%)47.8849.2043.1251.1446.29
PBIT Margin (%)44.7245.4340.0148.0043.10
PBT Margin (%)44.2045.0739.8247.7542.72
Net Profit Margin (%)30.9230.6331.0236.6134.26
NP After MI And SOA Margin (%)30.3029.9330.3336.0333.80
Return on Networth / Equity (%)14.0112.4211.5915.2015.44
Return on Capital Employeed (%)19.4317.8014.6519.2718.78
Return On Assets (%)11.9410.8310.3213.3213.30
Long Term Debt / Equity (X)0.020.000.000.000.00
Total Debt / Equity (X)0.020.000.000.000.00
Asset Turnover Ratio (%)0.410.330.310.340.35
Current Ratio (X)8.5710.1911.0110.344.95
Quick Ratio (X)8.5710.1911.0110.344.95
Dividend Payout Ratio (NP) (%)0.0071.0250.9944.79104.13
Dividend Payout Ratio (CP) (%)0.0063.0746.2441.1995.15
Earning Retention Ratio (%)0.0028.9849.0155.21-4.13
Cash Earning Retention Ratio (%)0.0036.9353.7658.814.85
Interest Coverage Ratio (X)92.77137.04230.27205.78121.60
Interest Coverage Ratio (Post Tax) (X)60.9186.31166.65148.3191.00
Enterprise Value (Cr.)3303.861859.531441.35932.75859.57
EV / Net Operating Revenue (X)9.966.675.823.753.53
EV / EBITDA (X)20.8013.5513.507.347.62
MarketCap / Net Operating Revenue (X)10.066.846.134.883.98
Retention Ratios (%)0.0028.9749.0055.20-4.13
Price / BV (X)4.652.842.342.061.82
Price / Net Operating Revenue (X)10.066.846.134.883.98
EarningsYield0.030.040.040.070.08

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of CARE Ratings Ltd as of November 21, 2024 is: 1,314.29

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

As of November 21, 2024, CARE Ratings Ltd is Overvalued by 3.64% compared to the current share price 1,364.00

Intrinsic Value of CARE Ratings Ltd as of November 21, 2024 is: 1,349.62

Calculation basis:

  • Intrinsic value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the intrinsic value of the stock by analyzing its fundamental indicators along with EPS growth.

As of November 21, 2024, CARE Ratings Ltd is Overvalued by 1.05% compared to the current share price 1,364.00

Last 5 Year EPS CAGR: 2.69%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 31.17%, which is a positive sign.
  2. The company has higher reserves (528.85 cr) compared to borrowings (5.69 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (277.92 cr) and profit (162.23 cr) over the years.
  1. The stock has a high average Working Capital Days of 130.00, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 34.50, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in CARE Ratings Ltd:
    1. Net Profit Margin: 30.92%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 19.43% (Industry Average ROCE: 21%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 14.01% (Industry Average ROE: 15.05%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 60.91
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 8.57
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 35.5 (Industry average Stock P/E: 37.5)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.02
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

CARE Ratings Ltd. is a Public Limited Listed company incorporated on 21/04/1993 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L67190MH1993PLC071691 and registration number is 071691. Currently Company is involved in the business activities of Activities auxiliary to financial service activities. Company’s Total Operating Revenue is Rs. 219.27 Cr. and Equity Capital is Rs. 29.65 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
Rating Services4th Floor, Godrej Coliseum, Mumbai Maharashtra 400022investor.relations@careedge.in
http://www.careratings.com
Management
NamePosition Held
Mr. Najib ShahChairman(NonExe.&Ind.Director)
Mr. Mehul Harshadray PandyaManaging Director & CEO
Mr. V ChandrasekaranInd. Non-Executive Director
Mr. Adesh Kumar GuptaInd. Non-Executive Director
Ms. Sonal Gunvant DesaiInd. Non-Executive Director
Dr. M MathisekaranInd. Non-Executive Director
Mr. G MahalingamInd. Non-Executive Director
Mr. Sobhag Mal JainNon Exe.Non Ind.Director

FAQ

What is the latest intrinsic value of CARE Ratings Ltd?

The latest intrinsic value of CARE Ratings Ltd as on 21 November 2024 is ₹1314.29, which is 3.64% lower than the current market price of ₹1,364.00.

What is the Market Cap of CARE Ratings Ltd?

The Market Cap of CARE Ratings Ltd is 4,065 Cr..

What is the current Stock Price of CARE Ratings Ltd as on 21 November 2024?

The current stock price of CARE Ratings Ltd as on 21 November 2024 is ₹1,364.

What is the High / Low of CARE Ratings Ltd stocks in FY 2024?

In FY 2024, the High / Low of CARE Ratings Ltd stocks is 1,571/891.

What is the Stock P/E of CARE Ratings Ltd?

The Stock P/E of CARE Ratings Ltd is 35.5.

What is the Book Value of CARE Ratings Ltd?

The Book Value of CARE Ratings Ltd is 252.

What is the Dividend Yield of CARE Ratings Ltd?

The Dividend Yield of CARE Ratings Ltd is 1.32 %.

What is the ROCE of CARE Ratings Ltd?

The ROCE of CARE Ratings Ltd is 20.6 %.

What is the ROE of CARE Ratings Ltd?

The ROE of CARE Ratings Ltd is 14.5 %.

What is the Face Value of CARE Ratings Ltd?

The Face Value of CARE Ratings Ltd is 10.0.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in CARE Ratings Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE