BSE:511066

Stock Analysis Report

Executive Summary

Sakthi Finance Limited, a non-banking financial company, primarily provides asset financing services in India.


Snowflake Analysis

Fair value second-rate dividend payer.

Share Price & News

How has Sakthi Finance's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 511066's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-7.4%

511066

-10.6%

IN Consumer Finance

-2.9%

IN Market


1 Year Return

-30.4%

511066

-26.9%

IN Consumer Finance

-29.3%

IN Market

Return vs Industry: 511066 underperformed the Indian Consumer Finance industry which returned -26.4% over the past year.

Return vs Market: 511066 underperformed the Indian Market which returned -29.2% over the past year.


Shareholder returns

511066IndustryMarket
7 Day-7.4%-10.6%-2.9%
30 Day-13.7%-44.5%-26.5%
90 Day-14.4%-39.0%-28.5%
1 Year-26.1%-30.4%-26.2%-26.9%-27.9%-29.3%
3 Year-54.6%-59.9%24.0%21.2%-15.4%-20.0%
5 Year-11.3%-27.2%104.9%95.5%-3.3%-8.3%

Price Volatility Vs. Market

How volatile is Sakthi Finance's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Sakthi Finance undervalued compared to its fair value and its price relative to the market?

6.36x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 511066 (₹12.52) is trading above our estimate of fair value (₹1.53)

Significantly Below Fair Value: 511066 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 511066 is good value based on its PE Ratio (6.4x) compared to the Consumer Finance industry average (10.4x).

PE vs Market: 511066 is good value based on its PE Ratio (6.4x) compared to the Indian market (9.2x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 511066's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 511066 is good value based on its PB Ratio (0.4x) compared to the IN Consumer Finance industry average (0.6x).


Next Steps

Future Growth

How is Sakthi Finance forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

26.0%

Forecasted Diversified Financials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Sakthi Finance has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Sakthi Finance performed over the past 5 years?

-7.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 511066 has high quality earnings.

Growing Profit Margin: 511066's current net profit margins (13.4%) are lower than last year (14.8%).


Past Earnings Growth Analysis

Earnings Trend: 511066's earnings have declined by -7.8% per year over the past 5 years.

Accelerating Growth: 511066's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 511066 had negative earnings growth (-2.8%) over the past year, making it difficult to compare to the Consumer Finance industry average (15.6%).


Return on Equity

High ROE: 511066's Return on Equity (7.1%) is considered low.


Next Steps

Financial Health

How is Sakthi Finance's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: 511066 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 511066's debt is covered by short term assets (assets are 1.4x debt).


Financial Institutions Analysis

Asset Level: 511066's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if 511066 has a sufficient allowance for bad loans.

Low Risk Liabilities: 511066 reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if 511066 has an acceptable proportion of non-loan assets held.

Low Risk Deposits: 511066 has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if 511066 has an appropriate level of bad loans.


Next Steps

Dividend

What is Sakthi Finance's current dividend yield, its reliability and sustainability?

7.99%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 511066's dividend (7.99%) is higher than the bottom 25% of dividend payers in the Indian market (0.95%).

High Dividend: 511066's dividend (7.99%) is in the top 25% of dividend payers in the Indian market (4.18%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 511066 has been paying a dividend for less than 10 years.

Growing Dividend: 511066 has only been paying a dividend for 9 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (50.8%), 511066's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

12.4yrs

Average board tenure


CEO

Mahalingam Balasubramaniam (61yo)

no data

Tenure

₹11,463,000

Compensation

Mr. Mahalingam Balasubramaniam, M.Com., MBA, has been Vice Chairman of the Board and Managing Director of Sakthi Finance Limited, since October 24, 2007. Mr. Balasubramaniam had been a Managing Director at ...


CEO Compensation Analysis

Compensation vs Market: Mahalingam's total compensation ($USD152.08K) is above average for companies of similar size in the Indian market ($USD48.50K).

Compensation vs Earnings: Mahalingam's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Mahalingam Balasubramaniam
Vice Chairman & MDno data₹11.46m0.38% 2.4m
S. Veluswamy
Director of Finance & Operations and Additional Non Independent Executive Director0.83yr₹3.22mno data
P. Gopalakrishnan
Independent Non-Executive Director15.33yrs₹200.00kno data
Mahalingam Manickam
Non-Executive Chairman12.42yrs₹80.00k0.19% 1.2m
Mahalingam Srinivaasan
Non-Executive Director25.92yrs₹140.00k0.50% 3.1m
A. Selvakumar
Independent Non-Executive Director19yrs₹380.00k0.00060% 3.8k
Priya Bhansali
Non-Executive Independent Director5yrs₹160.00kno data
K. Ramakrishnan
Non-Executive Independent Director4.83yrs₹300.00kno data

12.4yrs

Average Tenure

62yo

Average Age

Experienced Board: 511066's board of directors are seasoned and experienced ( 12.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Sakthi Finance Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sakthi Finance Limited
  • Ticker: 511066
  • Exchange: BSE
  • Founded: 1955
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: ₹626.000m
  • Shares outstanding: 50.00m
  • Website: https://www.sakthifinance.com

Number of Employees


Location

  • Sakthi Finance Limited
  • 62, Dr. Nanjappa Road
  • Coimbatore
  • Tamil Nadu
  • 641018
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
511066BSE (Mumbai Stock Exchange)YesEquity SharesININRApr 2002

Biography

Sakthi Finance Limited, a non-banking financial company, primarily provides asset financing services in India. It is involved in the provision of hire purchase financing of commercial vehicles, infrastructure and construction equipment, machineries, etc. The company also offers non-convertible debentures, fixed and cumulative income deposits, and subordinated bonds. It operates through a network of approximately 50 branches located in Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, and Telangana, as well as in Maharashtra, Puducherry, and New Delhi. Sakthi Finance Limited was founded in 1955 and is headquartered in Coimbatore, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 12:53
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.