Lead Financial Services Limited

Financial Services — Credit Services · BSE

₹17.10₹0.00 (0.00%)

DalalBaazaar Score

60 / 100

🟢 Good

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:05 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

The 60-second version of Lead Financial Services Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Lead Financial Services Limited operates as a non-banking financial company primarily in India. It offers loans and financial services. The company was incorporated in 1993 and is based in New Delhi, India.

IndustryCredit Services

SectorFinancial Services

Employees3

Annual revenue₹1 Cr

How does it make money?

Turns over ₹1 Cr a year. Of every ₹100 of sales, about ₹18 reaches shareholders as profit, with ₹34 left at the operating level before interest, tax and depreciation. Each of its 3 employees supports ₹19.2 lakh of revenue a year, the signature of a people-led business.

EBITDA margin34.0%

Net margin18.2%

Revenue / employee₹19.2 lakh

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, STATE BANK OF INDIA, HDFC BANK LTD, ICICI BANK LTD.. These are the companies its valuation and returns are measured against elsewhere in this report.

BAJAJ FINANCE LIMITEDP/E 30.2x · ROE 17.8%

STATE BANK OF INDIAP/E 10.3x · ROE 15.2%

HDFC BANK LTDP/E 15.9x · ROE 13.8%

ICICI BANK LTD.P/E 18.1x · ROE 16.5%

What is its competitive advantage?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

ROCE1.8%

ROE1.7%

Peer median ROE16.5%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +82% while net margin moved -60% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+82%

Margin effect-60%

DalalBaazaar Score

60/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 71.3x is demanding — it needs sustained high growth to justify
✗ P/E is 102% above its own historical median of 35.3x — expensive by its own standards
✓ P/B of 0.87x is modest against book value

Quality vs. Valuation

Company Quality

66/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

29/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

71.3x

3Y Median

35.3x

40 monthly readings · mean 36.5x · range 19.0x–56.3x

Sector Median

17.0x

median of 4 sector peers

⚠️Current valuation is approximately 102% above its 3y median of 35.3x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 319% above the peer median of 17.0x.

vs. its own history

Expensive

35.3x median over 40 months · +102%

vs. sector peers

Expensive

17.0x median of 4 peers · +319%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

71.3x

P/B

0.87x

EV/EBITDA

28.4x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Valuation above its historical average
At 71.3x the stock trades 102% above its own median of 35.3x.

Red Flags

1 item require attention · 1 watch

🟡Profit is decliningFinancial
Net profit is down 27% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

The price already assumes success
The stock trades 102% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 17% a year✓ 22.2% CAGR
Latest reported year was -22.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 32%✓ 34.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 8%✗ 1.7%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Valuation vs its own median of 35.3x✗ 71.3x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

4 / 10 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✗ Revenue growing year-over-year
✗ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

2 good · 3 neutral · 6 weak

Market Cap

₹6 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

71.3x

Expensive

Expensive — verify against sector peers

P/B Ratio

0.87x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.24

Profitable

Profitable on a per-share basis

ROE

1.7%

Weak

Weak capital efficiency

ROCE

1.8%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

-22.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

-30.8%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹1 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹17.1

Operating Margin

63.9%

Good

Healthy core-business profitability

Net Margin

15.0%

Good

Strong bottom-line conversion

Current Ratio

409.16

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.47

Defensive

Steadier than the market

52W Range Position

27%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

16.4 / 16.1

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

67.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹0 Cr	₹1 Cr	₹1 Cr	₹1 Cr	+22.2%
EBITDA	₹0 Cr	₹0 Cr	₹0 Cr	₹0 Cr	+22.6%
EBITDA Margin	33.6%	65.1%	43.1%	34.0%	—
PAT (Net Profit)	₹0 Cr	₹0 Cr	₹0 Cr	₹0 Cr	-9.8%
EPS	₹0.43	₹0.75	₹0.49	₹0.32	-9.4%
ROE	2.5%	4.2%	2.7%	1.7%	—
ROCE	1.4%	3.3%	2.6%	1.8%	—
Free Cash Flow	₹2 Cr	-₹2 Cr	₹1 Cr	-₹1 Cr	—

🟢 Revenue has grown at 22.2% a year over 3 years.

🟢 EBITDA has grown at 22.6% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 34.0% over 3 years.

🔴 PAT (Net Profit) has shrunk at 9.8% a year over 3 years.

🔴 EPS has shrunk at 9.4% a year over 3 years.

🟡 ROE has held roughly flat at 1.7% over 3 years.

🟡 ROCE has held roughly flat at 1.8% over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹11 Cr

Total Liabilities

₹5 Cr

Total Debt

—

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹1 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

71.4%

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
STATE BANK OF INDIA	10.3x	15.2%
HDFC BANK LTD	15.9x	13.8%
ICICI BANK LTD.	18.1x	16.5%

Recent News

1 mixed5 general

Share Market Today: Nifty 50, Bank Nifty | Oct 15, 2026

Liquide Blog, 15 Oct

Lead Financial Services closes trading window for Q2FY27 results

scanx.trade, 26 SeptResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Share Market Today: Nifty 50, Bank Nifty | Oct 13, 2026

Liquide Blog, 13 Oct

Nifty Top Gainers & Losers, July 29, 2026, 3:30 PM IST: Jio Financial Leads

HDFC Sky, 29 Jul

Financial stocks lead correction as insurance overhaul plan sparks fears

Livemint, 24 Sept

The CEO factory: How ICICI, SBI, Axis shaping financial services leadership

Business Standard, 04 Oct

Watch Items

Revenue growth is negative (-22.3%) on the latest reported period — check if this is one-off or a trend.
This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

🟢Business QualityStrong15.9/20

🟢Financial HealthStrong17/20

🔴GrowthWeak8.9/20

🟡ProfitabilityModerate7.9/15

🔴ValuationDemanding6.2/15

🔴RiskHigh4.4/10

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you.

This thesis breaks if

✓Revenue growth stays above 17% a year22.2% CAGR
✓EBITDA margin holds above 32%34.0%
✗Return on equity stays above 8%1.7%
✗Valuation vs its own median of 35.3x71.3x today