NBI Industrial Finance Co. Shares Overview and Investing Insights

NBI Industrial Finance Co. is an interesting investment opportunity to analyze, given its substantial holdings in various companies, notably Shree Cements. This article delves into the financial health and valuation metrics of NBI Industrial Finance, highlighting its key ratios and investment perspectives.

Company Overview

NBI Industrial Finance Co. is a noteworthy player in the financial sector, known for its significant stakes in various companies, most notably Shree Cements. The company's major holdings include approximately 8.5 lakhs shares of Shree Cements, valued at around INR 1445 crores, along with other stakes in private companies that itself holds a stake in Shree Cements. In total, NBI Industrial Finance Co. holds approximately INR 2500 crores worth of stake in Shree Cements, currently valued at INR 454 crores.

Financial Ratios and Key Metrics

Parameter Value Market Cap. 453.92 Cr. Current Price 3695.2 Book Value 235.1 Stock P/E 99.33 Dividend Yield 0 Face Value 10 Listed on NSE 52 Week High/Low 4840 / 270 Dividend in Rs 0 EPS 37.2 Latest Annualized Cost of Equity -0.36 Latest Annualized Return on Equity -0.34 Cost of Equity based on Price to Earning Ratio 0.67 Return on equity 13.77 Forward Price to Earning Ratio 0 Justified Price to Earning Ratio -- Forward Earning Per Share 37.07 Estimated Price based on Forward EPS and Forward PE 0 Price as per Justified PE -- Estimated Market Price Based on Return on Equity -119.99 Market value of quoted investments 1065.47 Cr. Sustainable Growth Rate -12.47 Retention Based Growth Rate -0.34 Profit growth -- QoQ Profits -100.75 YOY Quarterly profit growth -101.69 Profit growth 3Years -- Sales growth -- Sales growth 3Years -- Average Estimated Price -- Debt to equity 0 Last result date 201612 Return on capital employed 101.53 Enterprise Value to Sales 80.61 Expected Dividend Next Year 0 Promoter holding 60 Unpledged promoter holding 60 OPM latest quarter -17.65 Pledged percentage 0 Enterprise Value 452.25 PEG Ratio -- Price to Sales 80.91 Latest Enterprise Value 430.15 Enterprise Value to Total Income 80.61 Enterprise Value to Total Income to Firm Margin 98.96 Firm Margin 0.81 Latest Ent Value to Total Income to Firm Margin -21507.5 Graham 443.6

Investment Analysis

Given the current market cap of NBI at 453.92 crores and its current price at 3695.2, the PE ratio of 99.33 suggests that investors are willing to pay a significantly higher price compared to its earnings. However, the negative return on equity (-0.34) and cost of equity based on P/E ratio (0.67) indicate financial distress or a declining trend, unlike the expected healthy growth. This negative performance is further highlighted by the dividend yield of 0, suggesting that the company does not pay dividends.

The company's historic performance, such as a drastic drop in quarterly profits (-100.75%) and a pessimistic outlook on future growth, might also pose significant risks. Moreover, the stagnant sales growth over the past three years could indicate that NBI is not effectively capitalizing on market opportunities.

Nevertheless, the significant market value of quoted investments (1065.47 crores) and the substantial stake in Shree Cements (valued at 1445 crores) can be attractive for investors looking to hedge their risks. However, the negative economic indicators and the decline in profits raise concerns about the company's long-term viability.

To make a more informed decision, diversification, deeper market analysis, and considering macroeconomic factors specific to the financial sector would be prudent. Further, engaging with financial analysts and industry experts could provide valuable insights into the potential future performance of NBI Industrial Finance Co.

Note: Always conduct thorough research and consider professional advice before making investment decisions.