Haryana Capfin Ltd Valuation Shifts to Very Attractive Amid Mixed Returns

Valuation Metrics Signal Enhanced Price Attractiveness

Recent data reveals Haryana Capfin’s price-to-earnings (P/E) ratio stands at a modest 7.93, markedly below many of its NBFC peers. This figure is complemented by an exceptionally low price-to-book value (P/BV) of 0.26, indicating the stock is trading well below its net asset value. Such valuation metrics have prompted a reclassification of the company’s valuation grade from merely attractive to very attractive as of the latest assessment.

In comparison, peer companies such as Ashika Credit and Arman Financial are trading at P/E ratios of 107.43 and 29.24 respectively, with corresponding valuation grades of expensive and very expensive. Even Satin Creditcare, rated attractive, posts a slightly lower P/E of 7.32 but a higher EV/EBITDA multiple of 6.36 compared to Haryana Capfin’s 16.85. This contrast underscores Haryana Capfin’s unique position as a micro-cap NBFC with compelling valuation metrics.

Profitability and Efficiency Metrics Remain Modest

While valuation appears enticing, Haryana Capfin’s return on capital employed (ROCE) and return on equity (ROE) remain subdued at 1.86% and 3.32% respectively. These figures suggest the company is generating limited profitability relative to its capital base and shareholder equity. The enterprise value to capital employed ratio is also notably low at 0.31, reflecting the company’s capital structure and market valuation dynamics.

Investors should weigh these modest profitability metrics against the valuation appeal, as low returns may temper expectations for near-term earnings growth or dividend yield, which is currently not available for this stock.

Stock Price and Market Performance Overview

Haryana Capfin’s current market price stands at ₹148.50, unchanged from the previous close, with a 52-week trading range between ₹119.05 and ₹232.95. The stock’s recent trading session saw a high of ₹150.35 and a low of ₹148.40, indicating relatively stable intraday movement.

Examining returns over various time horizons reveals a mixed picture. The stock outperformed the Sensex over the short term, gaining 1.71% in the past week and 3.81% over the last month, while the Sensex declined by 2.90% and 3.44% respectively during these periods. However, year-to-date (YTD) returns show a decline of 12.10%, slightly better than the Sensex’s 12.85% fall. Over the longer term, Haryana Capfin has delivered exceptional returns, with a 3-year gain of 120.42%, a 5-year surge of 312.50%, and a remarkable 10-year appreciation of 700.54%, far outpacing the Sensex’s respective gains of 18.96%, 43.00%, and 178.01%.

Comparative Valuation and Peer Analysis

When benchmarked against its NBFC peers, Haryana Capfin’s valuation multiples stand out for their affordability. The company’s EV to EBIT and EV to EBITDA ratios both sit at 16.85, which, while higher than Satin Creditcare’s 6.36 EV/EBITDA, remain reasonable compared to Meghna Infracon’s extremely elevated 170.27 EV/EBITDA multiple. The PEG ratio of 0.09 further highlights the stock’s low price relative to expected earnings growth, suggesting undervaluation.

However, it is important to note that some peers, such as Dolat Algotech and SMC Global Securities, also present attractive valuations with P/E ratios of 10.01 and 12.22 respectively, and lower EV/EBITDA multiples. These companies may offer alternative investment opportunities within the NBFC sector, depending on investor risk appetite and growth expectations.

Mojo Score and Rating Update

Haryana Capfin’s MarketsMOJO score currently stands at 34.0, reflecting a Sell rating. This represents an upgrade from a previous Strong Sell grade as of 15 Dec 2025, signalling a modest improvement in the company’s outlook. The micro-cap classification and relatively low profitability metrics likely contribute to the cautious stance despite the attractive valuation.

Investors should consider this rating in conjunction with the valuation and return data, recognising that while the stock may be undervalued, underlying business fundamentals and market risks remain pertinent factors.

Investment Considerations and Outlook

Haryana Capfin’s valuation shift to very attractive levels presents a potential opportunity for investors seeking value plays within the NBFC sector. The stock’s low P/E and P/BV ratios, combined with a PEG ratio well below 1, indicate that the market may be underpricing the company’s earnings potential relative to its asset base.

However, the company’s modest profitability metrics and micro-cap status introduce elements of risk, including limited liquidity and potential volatility. The stock’s recent underperformance relative to the Sensex over the past year (-20.18% vs. -8.82%) underscores the need for cautious appraisal.

Long-term investors may find Haryana Capfin’s decade-long return of over 700% compelling, but should balance this against the current economic environment and sector-specific challenges facing NBFCs. A thorough analysis of the company’s financial health, management quality, and growth prospects is advisable before committing capital.

Conclusion

In summary, Haryana Capfin Ltd’s valuation parameters have improved significantly, moving into very attractive territory relative to peers and historical levels. While this enhances the stock’s price appeal, investors must remain mindful of the company’s low profitability and micro-cap risks. The recent upgrade in MarketsMOJO rating from Strong Sell to Sell reflects this nuanced outlook. For those prioritising value and long-term growth potential, Haryana Capfin warrants consideration, albeit with prudent risk management.

Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year Start at 33% Off →