NSEI:CARERATING

Stock Analysis Report

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Market Cap

₹20.9b

Last Updated

2021/07/28 12:11 UTC

Data Sources

Company Financials +

Executive Summary

CARE Ratings Limited, a credit rating agency, provides various rating and grading services in India, Mauritius, and Nepal. More Details


Snowflake Analysis

Flawless balance sheet average dividend payer.

Share Price & News

How has CARE Ratings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CARERATING is less volatile than 75% of Indian stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: CARERATING's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

-0.5%

CARERATING

-0.7%

IN Capital Markets

0.9%

IN Market


1 Year Return

62.9%

CARERATING

53.0%

IN Capital Markets

51.8%

IN Market

Return vs Industry: CARERATING exceeded the Indian Capital Markets industry which returned 53% over the past year.

Return vs Market: CARERATING exceeded the Indian Market which returned 51.8% over the past year.


Shareholder returns

CARERATINGIndustryMarket
7 Day-0.5%-0.7%0.9%
30 Day-1.7%13.4%1.0%
90 Day43.7%31.0%11.0%
1 Year67.9%62.9%55.6%53.0%53.9%51.8%
3 Year-36.3%-44.2%18.5%13.7%37.0%30.0%
5 Year-19.8%-32.6%92.1%82.2%82.4%67.2%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is CARE Ratings undervalued compared to its fair value and its price relative to the market?

23.52x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: CARERATING (₹714.45) is trading above our estimate of fair value (₹426.97)

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


Price To Earnings Ratio

PE vs Industry: CARERATING is poor value based on its PE Ratio (23.5x) compared to the Indian Capital Markets industry average (19.2x).

PE vs Market: CARERATING is good value based on its PE Ratio (23.5x) compared to the Indian market (23.9x).


Price to Earnings Growth Ratio

PEG Ratio: CARERATING is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: CARERATING is overvalued based on its PB Ratio (3.6x) compared to the IN Capital Markets industry average (0.8x).


Future Growth

How is CARE Ratings forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

9.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CARERATING's forecast earnings growth (9.9% per year) is above the savings rate (6.8%).

Earnings vs Market: CARERATING's earnings (9.9% per year) are forecast to grow slower than the Indian market (20.6% per year).

High Growth Earnings: CARERATING's earnings are forecast to grow, but not significantly.

Revenue vs Market: CARERATING's revenue (9.9% per year) is forecast to grow slower than the Indian market (12.4% per year).

High Growth Revenue: CARERATING's revenue (9.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CARERATING's Return on Equity is forecast to be low in 3 years time (17.7%).


Past Performance

How has CARE Ratings performed over the past 5 years?

-13.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CARERATING has high quality earnings.

Growing Profit Margin: CARERATING's current net profit margins (36%) are higher than last year (33.8%).


Past Earnings Growth Analysis

Earnings Trend: CARERATING's earnings have declined by 13.5% per year over the past 5 years.

Accelerating Growth: CARERATING's earnings growth over the past year (8.7%) exceeds its 5-year average (-13.5% per year).

Earnings vs Industry: CARERATING earnings growth over the past year (8.7%) underperformed the Capital Markets industry 34.8%.


Return on Equity

High ROE: CARERATING's Return on Equity (15.3%) is considered low.


Financial Health

How is CARE Ratings's financial position?


Financial Position Analysis

Short Term Liabilities: CARERATING's short term assets (₹5.5B) exceed its short term liabilities (₹528.9M).

Long Term Liabilities: CARERATING's short term assets (₹5.5B) exceed its long term liabilities (₹258.4M).


Debt to Equity History and Analysis

Debt Level: CARERATING is debt free.

Reducing Debt: CARERATING had no debt 5 years ago.

Debt Coverage: CARERATING has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: CARERATING has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Dividend

What is CARE Ratings's current dividend yield, its reliability and sustainability?

3.50%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CARERATING's dividend (3.5%) is higher than the bottom 25% of dividend payers in the Indian market (0.35%).

High Dividend: CARERATING's dividend (3.5%) is in the top 25% of dividend payers in the Indian market (1.41%)


Stability and Growth of Payments

Stable Dividend: CARERATING has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: CARERATING's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (82.3%), CARERATING's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CARERATING's dividends in 3 years are forecast to be covered by earnings (53.9% payout ratio).


Next Steps

Management

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

1.3yrs

Average management tenure


CEO

Ajay Mahajan (52 yo)

1.25yrs

Tenure

Mr. Ajay Mohanlal Mahajan serves as Director at CARE Ratings (Africa) Private Limited since 2020. He has been Managing Director, Chief Executive Officer and Executive Director at CARE Ratings Limited since...


Leadership Team

Experienced Management: CARERATING's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Members

Experienced Board: CARERATING's board of directors are not considered experienced ( 1.9 years average tenure), which suggests a new board.


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

CARE Ratings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: CARE Ratings Limited
  • Ticker: CARERATING
  • Exchange: NSEI
  • Founded: 1993
  • Industry: Financial Exchanges and Data
  • Sector: Diversified Financials
  • Market Cap: ₹20.940b
  • Shares outstanding: 29.46m
  • Website: https://www.careratings.com

Number of Employees


Location

  • CARE Ratings Limited
  • Godrej Coliseum
  • 4th Floor
  • Mumbai
  • Maharashtra
  • 400022
  • India

Listings


Biography

CARE Ratings Limited, a credit rating agency, provides various rating and grading services in India, Mauritius, and Nepal. The company offers corporate rating services, such as corporate debt, bank loan, i...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/07/28 12:11
End of Day Share Price2021/07/28 00:00
Earnings2021/03/31
Annual Earnings2021/03/31


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.