Aavas Financiers Stock Price Analysis and Quick Research Report. Is Aavas Financiers an attractive stock to invest in?

Housing finance companies is a highly concentrated business-facing fierce competition and the industry has remained competitive for several years. The growth of the economy and also increase in the per capita income of individuals impact the housing industry as a whole.

These companies provide finance for housing in India to individuals and corporations. The housing finance companies majorly cater to low and middle-income individuals. The proportion of loans coming from housing companies is significantly increasing.

Around 2% of India's total population invests in financial assets. The penetration of the mutual fund industry in India is close to 7% (Based on the number of PAN cardholders). This under penetration of the mutual fund industry offers a huge opportunity for the industry to grow. Migration to financial savings, wider distribution and sustainable performance are expected to enable growth in the industry. Also, increasing financial literacy among investors, digitization and the number of mediums available tend to attract more investors to invest in the financial markets.

Aavas Financiers stock price today is Rs 1827.4. To understand the functions of the Aavas Financiers better, you must go through the following points:

Key Financials –

• Profitability: Profit margin (PAT margin) of the company shows how well a company controls its cost. It is one of the important indicators to show the financial health of the company. Net profit of the company is Rs 490.6942 Cr and the compounded growth of profit in the past 3 years is 19.2309731313385 %. The PAT margin of Aavas Financiers is 24.3219 %.

• EPS growth: Investors should ensure the EPS figure is growing faster than revenue numbers because it indicates company management is increasing the efficiency with which it runs the company. In Aavas Financiers , the EPS grew by 13.9764 % YOY. 

 Financial Ratios –

•  Return on Equity (ROE): Aavas Financiers has a average ROE track record. The ROE of Aavas Financiers is at 14.1263 % for the latest year.

• P/E Ratio: Relative valuation metrics like the P/E ratio can be used to see if the stock of Aavas Financiers is worth at the current levels at Rs 1827.4. Aavas Financiers is trading at a current P/E ratio of 21.2198 and the average historical P/E for the last 5 years was 42.0715821715532.

• P/B ratio can be one of the best metrics to value such companies. Currently, Aavas Financiers is trading at a P/B of 3.3154 . The average historical P/B for the last 5 years was 5.28851122944055. This can be compared with the Market price per share in order to know if the stock is undervalued or overvalued.

• Share Price: - The current share price of Aavas Financiers is Rs 1827.4. One can use valuation calculators of ticker to know if Aavas Financiers share price is undervalued or overvalued.