Cholamandalam Investment and Finance Company Limited’s fundamental analysis highlights key financial metrics including market capitalization of ₹1,13,319 crore, PE ratio of 31.0, debt-to-equity ratio of 6.86, and return on equity of 20.2% These figures reflect the company’s financial health and current market valuation.
Content:
- Cholamandalam Investment and Finance Company Ltd Overview
- Cholamandalam Investment and Finance Company Financial Results
- Cholamandalam Investment and Finance Company Financial Analysis
- Cholamandalam Investment and Finance Company Company Metrics
- Cholamandalam Investment and Finance Company Stock Performance
- Cholamandalam Investment and Finance Company Peer Comparison
- Cholamandalam Investment and Finance Company Shareholding Pattern
- Cholamandalam Investment and Finance Company History
- How To Invest In Cholamandalam Investment and Finance Company Ltd Share?
- Cholamandalam Investment and Finance Company Limited Fundamental Analysis – FAQs
Cholamandalam Investment and Finance Company Ltd Overview
Cholamandalam Investment and Finance Company Ltd is a leading non-banking financial company (NBFC) in India, offering diverse financial services including vehicle finance, home loans, and SME loans. Backed by the Murugappa Group, it has grown through strategic partnerships and digital innovation, serving individuals and small businesses nationwide.
The company has a market capitalization of ₹1,13,319 crore and is listed on both the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). Currently, the stock is trading 8.69% below its 52-week high and 35.2% above its 52-week low.
Cholamandalam Investment and Finance Company Financial Results
Cholamandalam Investment and Finance Company Ltd’s financial results for FY24 highlight significant growth, with total income reaching ₹19,420 crores, up from ₹10,232 crores in FY22. Net profit increased to ₹3,420 crores from ₹2,154 crores.
- Revenue Trend: Cholamandalam Investment and Finance Company Ltd’s total income rose to ₹19,420 crores in FY24 from ₹13,106 crores in FY23, showcasing strong revenue growth.
- Equity and Liabilities: The company’s equity and liabilities structure showcases financial stability and strategic management. It effectively balances equity financing and debt to ensure sustainability and capital flexibility for growth initiatives.
- Profitability: Cholamandalam Investment and Finance Company Ltd’s PPOP margin declined to 30.5% in FY24 from 34.06% in FY23, indicating a slight reduction in operating efficiency.
- Earnings Per Share (EPS): Cholamandalam Investment and Finance Company Ltd’s EPS increased to ₹41.17 in FY24 from ₹32.44 in FY23, reflecting improved profitability and higher returns for shareholders.
- Return on Net Worth (RoNW): The steady rise in net profit and EPS indicates a healthy return on net worth, driven by increased operational success.
- Financial Position: Cholamandalam Investment and Finance Company Ltd’s financial strength is evident in the rising profit before tax and controlled provisions, enhancing overall financial stability.
Cholamandalam Investment and Finance Company Financial Analysis
| FY 24 | FY 23 | FY 22 | |
| Total Income | 19,420 | 13,106 | 10,232 |
| Total Expenses | 13,497 | 8,641 | 6,444 |
| Pre-Provisioning Operating Profit | 5,923 | 4,464 | 3,788 |
| PPOP Margin (%) | 30.5 | 34.06 | 37.02 |
| Provisions and Contingencies | 1,318 | 849.71 | 880.34 |
| Profit Before Tax | 4,605 | 3,615 | 2,908 |
| Tax % | 25.94 | 25.95 | 25.75 |
| Net Profit | 3,420 | 2,665 | 2,154 |
| EPS | 41.17 | 32.44 | 26.24 |
| Dividend Payout % | 4.86 | 6.17 | 7.62 |
*All values in ₹ Crores
Cholamandalam Investment and Finance Company Company Metrics
Cholamandalam Investment and Finance Company Ltd’s financial metrics present a comprehensive view of its market performance and valuation. The company has demonstrated strong growth with a high market cap and robust profitability, underscoring its significant presence in the financial sector.
- Market Cap: With a market capitalization of ₹1,13,319 crore, Cholamandalam stands as a major player in the financial industry.
- Book Value: The book value per share is ₹233, indicating the company’s net asset value. A higher book value compared to the stock price suggests that the shares are trading at a premium relative to their net worth.
- Face Value: Cholamandalam’s face value is ₹2.00 per share. This nominal value is used to calculate dividends and reflects the original value of the shares as stated in the company’s financial documents.
- Turnover: The asset turnover ratio is 0.14, reflecting the efficiency with which the company utilizes its assets to generate revenue.
- PE Ratio: The stock’s price-to-earnings (P/E) ratio is 31.0, suggesting that the stock is valued at 31 times its earnings.
- Debt: Cholamandalam has a substantial debt of ₹1,34,475 crore, indicating significant leverage. The high debt level reflects the company’s reliance on borrowing to finance its operations and growth strategies.
- ROE: With a return on equity (ROE) of 20.2%, Cholamandalam effectively generates substantial profits relative to its shareholders’ equity. This strong ROE indicates efficient management and high profitability.
- EBITDA Margin: The EV/EBITDA ratio is 16.0, providing insight into the company’s valuation relative to its earnings before interest, taxes, depreciation, and amortization. A higher ratio indicates that the stock is priced high relative to EBITDA.
- Dividend Yield: The dividend yield stands at 0.15%, reflecting the return on investment from dividends relative to the stock price. This low yield indicates that the company prioritizes reinvestment over distributing profits to shareholders.
Cholamandalam Investment and Finance Company Stock Performance
The table shows Cholamandalam Investment and Finance Company’s returns on investment over various periods: 38% over 5 years, 39% over 3 years, and 29% over 1 year. These figures reflect strong long-term growth and substantial recent gains, demonstrating consistent performance and investor value.
| Period | Return on Investment (%) |
| 5 Years | 38% |
| 3 Years | 39% |
| 1 Year | 29% |
Example:
If investor A invested ₹1,00,000 in Cholamandalam shares 5 years ago, their investment would have grown by 38%, resulting in a total return of ₹1,38,000.
Over 3 years, the same investment would have seen a 39% return, yielding ₹1,39,000.
For a 1-year investment, the return would be 29%, totaling ₹1,29,000.
Cholamandalam Investment and Finance Company Peer Comparison
Cholamandalam Investment and Finance Company’s market cap comparison shows varied performance among competitors. Bajaj Finance leads with the highest market cap at ₹399,568.64 Crore but has a lower 1-year return. Shriram Finance boasts the best returns, highlighting its strong market position.
| S.No. | Name | CMP Rs. | Mar Cap Rs.Cr. | PEG | 3mth return % | 1Yr return % |
| 1 | Bajaj Finance | 6458.5 | 399568.64 | 0.91 | -4.28 | -7.97 |
| 2 | Bajaj Finserv | 1529.15 | 243995.49 | 1.43 | -4.19 | 3.18 |
| 3 | Jio Financial | 320.2 | 203400.7 | -9.82 | ||
| 4 | Cholaman.Inv.&Fn | 1344 | 112919.82 | 1.32 | 6.5 | 29.5 |
| 5 | Shriram Finance | 2895.1 | 108783.15 | 0.62 | 23.79 | 59.64 |
| 6 | Bajaj Holdings | 9390.6 | 104403 | 0.74 | 12.65 | 28.64 |
| 7 | HDFC AMC | 4144.1 | 88452.56 | 2.69 | 7.5 | 66.12 |
Cholamandalam Investment and Finance Company Shareholding Pattern
The shareholding Pattern of Cholamandalam Investment and Finance Company Ltd shows a stable distribution of ownership over recent years. In June 2024, promoters hold 50.33%, while FIIs have increased their stake to 26.63%. DIIs hold 16.86%, and retail & others account for 6.19%.
| Jun 2024 | Mar 2024 | Dec 2023 | Sept 2023 | |
| Promoters | 50.33 | 50.35 | 50.37 | 51.43 |
| FII | 26.63 | 26 | 24.73 | 21.51 |
| DII | 16.86 | 17.05 | 18.39 | 20.04 |
| Retail & others | 6.19 | 6.61 | 6.51 | 7.03 |
*All values in %
Cholamandalam Investment and Finance Company History
Cholamandalam Investment and Finance Company Ltd, founded in 1978 by the Murugappa Group, began as a hire purchase and leasing firm in Chennai. It initially focused on financing industrial equipment, computers, and consumer durables, steadily expanding its financial services portfolio.
In the 1990s, the company diversified into automobile finance, mutual funds, and risk management, forming strategic partnerships with global entities like Guardian Royal Exchange and AXA S.A. It also launched innovative products like child education fixed deposits and successfully issued rights and debenture offerings.
Throughout the 2000s and beyond, Cholamandalam continued to grow through strategic acquisitions, partnerships, and expanding its footprint across India. Significant milestones include its rebranding in 2010, digital transformation initiatives, and recent forays into co-lending and consumer SME ecosystems, positioning it as a leading NBFC in India.
How To Invest In Cholamandalam Investment and Finance Company Ltd Share?
Investing in Cholamandalam Investment and Finance Company Ltd shares is a straightforward process:
- Open a Demat Account: Start by opening a Demat and trading account with a reliable brokerage firm like Alice Blue.
- Complete KYC: Submit necessary documents for KYC verification.
- Fund Your Account: Deposit funds into your trading account.
- Buy Shares: Search for Cholamandalam Investment and Finance Company Ltd shares and place your buy order.
Cholamandalam Investment and Finance Company Limited Fundamental Analysis – FAQs
Cholamandalam Investment and Finance Company Limited’s fundamental analysis reveals a market capitalization of ₹1,13,319 crore, a PE ratio of 31.0, a debt-to-equity ratio of 6.86, and a return on equity of 20.2%, indicating strong financial health and market standing.
The market cap of Cholamandalam Investment and Finance Company Limited as of August 12, 2024, is approximately ₹1,13,319 crore. This value reflects the company’s strong market position in the Indian non-banking financial industry.
Cholamandalam Investment and Finance Company Limited is a leading non-banking financial company (NBFC) in India, offering a range of financial services, including vehicle loans, home loans, small business loans, and insurance, primarily serving individuals and small businesses.
Cholamandalam Investment and Finance Company is primarily owned by the Murugappa Group, a large Indian business conglomerate. The group’s holding company, Tube Investments of India, holds a significant stake in Cholamandalam.
The main shareholders of Cholamandalam Investment and Finance Company include Murugappa Group through Tube Investments of India, institutional investors like mutual funds, insurance companies, and foreign portfolio investors, along with retail investors holding smaller individual stakes.
Cholamandalam Investment and Finance Company operates in the non-banking financial company (NBFC) sector, specializing in vehicle finance, home loans, and small business loans. It plays a significant role in providing financial services to individuals and businesses across India.
To invest in Cholamandalam Investment and Finance Company Ltd shares, open a brokerage account, research the stock, and place a buy order through your brokerage platform. Monitor the investment regularly to align with your financial goals.
Determining if Cholamandalam Investment and Finance Company is overvalued or undervalued requires a comprehensive analysis of its financials, growth prospects, industry trends, and market conditions. Investors should consider metrics like the P/E ratio and PEG ratio, and compare them with industry peers and historical values for a balanced assessment.
Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time The securities quoted are exemplary and are not recommendatory.
