Max Financial (MFSL)
Slow GrowerFairStock Score: 38/100 — MIXED
Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹1,538.1 |
| Market Cap | ₹52,825.53 Cr |
| P/E Ratio | 476.19 |
| ROCE | 8.13% |
| ROE | 2.69% |
| Dividend Yield | 0% |
| Profit Growth | -65.33% |
| Debt/Equity | 0.13 |
| Sales Growth | -40.2% |
| Free Cash Flow | ₹-1,351 Cr |
| Promoter Holding | 1.25% |
| 52-Week Range | ₹1,433.6 — ₹1,892.5 |
| Sector | Insurance |
| Book Value | ₹79.7 |
Strengths
- 5-year revenue CAGR of 8.24% shows modest growth
- Piotroski F-Score of 7/9 indicates acceptable fundamental health
- Debt/Equity of 0.34 suggests manageable leverage
- Large operational scale with latest quarterly sales of ₹14,259 crore
Concerns
- Extremely high valuation: P/E 435.60, P/B 10.44, and EV/EBITDA 220.36
- Very weak profitability: net profit of ₹45 crore on ₹14,259 crore sales, ROE 2.69%, and profit growth down 65.33%
- Negative free cash flow of ₹1,351 crore and Altman Z-Score of 0.49 indicate financial stress
- Promoter holding of just 1.25% and zero dividend yield are red flags for minority investors
AI Analysis
Looking at Max Financial, my initial reaction is to recall Graham's maxim: price is what you pay, value is what you get. At ₹1,595 with a P/E of 435 and a price-to-book of 10.44, the market is paying a princely sum for a business earning an ROE of just 2.69%. The latest quarter tells the story: sales of ₹14,259 crore but net profit of only ₹45 crore. That is a razor-thin margin and explains why profit growth has collapsed by 65%. A franchise can be good, but a good business is not a good investment at any price. The Graham Number sits at ₹118.88, so the current quote offers a margin of safety of negative 1,425%. That is not investing; it is speculation. I do see some positives. Revenue has compounded at 8.24% over five years, the Piotroski score of 7 out of 9 suggests management is not running the company recklessly, and debt to equity of 0.34 is manageable. Life insurance is a business that can build durable customer relationships. But free cash flow is minus ₹1,351 crore, Altman Z-Score is 0.49, and the dividend yield is zero. Promoter holding of just 1.25% also worries me; I want owners with skin in the game. This is not a business I can value with comfort. The market cap of ₹62,583 crore implies expectations that profits will revive and compound for years. At a 435 P/E, all the good news is already in the price. I prefer a margin of safety; here there is none. I would keep it on my watchlist, but not in my portfolio.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer