Valuation Metrics Signal Improved Price Attractiveness
Gilada Finance is currently making waves in the market with its price-to-earnings (P/E) ratio of 8.54. This promising multiple positions the company in a favourable light when compared to many of its non-banking financial company (NBFC) peers. Notably, it stands in stark contrast to heavyweight players like Mufin Green and Arman Financial, which flaunt P/E ratios of 102.11 and 63.02 respectively—both categorized as very expensive. Furthermore, Gilada’s price-to-book value (P/BV) at 0.76 indicates that the stock is trading below its intrinsic book value, a classic hallmark that screams undervaluation to keen-eyed value investors looking for potential bargains.
Adding to the attraction, Gilada boasts an enterprise value to EBITDA (EV/EBITDA) ratio of 7.01, making its valuation competitive within the NBFC landscape. For context, Satin Creditcare, another noteworthy peer, sits at an EV/EBITDA of 6.05, whereas Ashika Credit’s eye-popping ratio of 95.13 signals a heady valuation, potentially making investors wary. The low PEG ratio of 0.25 further suggests that the market hasn’t fully accounted for the company’s earnings growth, hinting at potential upside if growth rates meet or exceed expectations.
Financial Performance and Returns Contextualise Valuation
When looking at financial performance, Gilada Finance showcases a return on capital employed (ROCE) of 11.54% and return on equity (ROE) of 8.92%. These figures reflect moderate profitability and an efficient capital utilization relative to its industry counterparts. While the return metrics may not be spectacular, they align well with the company’s recent valuation upgrades, suggesting a stable operational footing.
Turning to stock performance, Gilada has managed to surpass the Sensex in multiple time frames. Year-to-date, the stock has risen by 2.72%, in contrast to the Sensex’s decline of 2.28%. Looking back over the past year, Gilada’s impressive return of 18.35% nearly doubles the benchmark’s 9.66%. However, it’s worth noting that in the longer run, underperformance over three and five-year periods raises eyebrows—recording -11.28% and +36.78% against the Sensex’s returns of +35.81% and +59.83% respectively. Still, a striking ten-year return of 383.48% outshone the Sensex’s 259.08%, illustrating the company’s robust historical growth despite prevailing volatility.
Comparative Valuation Within the NBFC Sector
When benchmarked against its peers, Gilada Finance provides a relatively conservative investment option. Companies like Mufin Green and Ashika Credit may be commanding exorbitant premiums, but Gilada’s appealing P/E and EV/EBITDA ratios signal a more prudent entry point for investors seeking exposure to the NBFC sector without the looming threat of excessive valuation risk. However, it’s important to note that other peers, such as Satin Creditcare and Dolat Algotech, also exhibit attractive valuations—with P/E ratios of 8.72 and 11.32 respectively—indicating a cluster of reasonably valued stocks within the sector.
Conversely, certain players such as LKP Finance and Avishkar Infra are perceived as risky investments due to ongoing losses, underlining the necessity of scrutinizing fundamental quality alongside valuation metrics in stock selection.
Market Capitalisation and Trading Dynamics
Gilada Finance’s market capitalization is rated at 4, reflecting its micro-cap status. The stock is currently priced at ₹13.61, up 1.34% for the day, and oscillates in a 52-week trading range between ₹9.30 and ₹23.80. Recent price movements indicate moderate investor interest, bolstered by the valuation upgrade that has shifted from very attractive to attractive, potentially igniting renewed buying interest.
Despite its compelling valuation, MarketsMOJO has assigned a Mojo Score of 44.0 with a Sell rating, down from Hold on January 5, 2026. This suggests that any newfound valuation strength may be overshadowed by concerns over growth trajectories, liquidity, or broader sector risks.
Implications for Investors: Balancing Valuation and Quality
The recent upgrade to an attractive valuation grade signifies that Gilada Finance’s stock price presents a more enticing entry point when viewed against its earnings and book value. For value-oriented investors, the sub-9 P/E and sub-1 P/BV ratios reinforce the notion that the stock trades at a discount to its intrinsic worth, especially in comparison to other richly valued peers.
However, with a modest ROE of 8.92% and the Mojo Sell rating, investors are urged to carefully consider the delicate balancing act between valuation and operational quality alongside growth prospects. Gilada’s low PEG ratio of 0.25 implies that earnings growth is not yet fully absorbed by the market, yet risks associated with slower growth or sector headwinds remain palpable.
While the stock’s recent outperformance against the Sensex over shorter and medium-term periods is a positive sign, the longer-term underperformance over three and five years necessitates a closer examination of possible cyclical challenges or competitive pressures.
Sector Outlook and Market Context
The NBFC sector is currently navigating a multifaceted environment shaped by regulatory scrutiny, credit quality challenges, and shifting interest rate dynamics. In this backdrop, Gilada Finance’s improved valuation could indicate a market recalibration of risk and reward, as investors search for stocks that display stable fundamentals at reasonable prices.
Given the sector’s diverse nature, investors are encouraged to conduct thorough due diligence. A careful assessment of Gilada’s financial health, asset quality, and growth prospects in comparison with other NBFCs and financial services companies is essential. The presence of both highly valued and risky peers reinforces the critical need for selective stock selection within this sector.
Key Financial Metrics Summary:
- P/E Ratio: 8.54
- Price to Book Value: 0.76
- EV/EBITDA: 7.01
- PEG Ratio: 0.25
- ROCE: 11.54%
- ROE: 8.92%
- Mojo Score: 44.0 (Sell, downgraded from Hold on 05 Jan 2026)
- Market Cap Grade: 4 (Micro-cap)
Stock Price and Returns Overview:
- Current Price: ₹13.61 (up 1.34% on the day)
- 52-Week Range: ₹9.30 – ₹23.80
- YTD Return: +2.72% vs Sensex -2.28%
- 1-Year Return: +18.35% vs Sensex +9.66%
- 3-Year Return: -11.28% vs Sensex +35.81%
- 5-Year Return: +36.78% vs Sensex +59.83%
- 10-Year Return: +383.48% vs Sensex +259.08%
As the market continues to evolve, monitoring the quarterly results and sector developments closely will be crucial in reassessing Gilada Finance’s valuation and operational trajectory within this dynamic NBFC landscape.
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