New India Assura (NIACL)

FairStock Score: 45/100 — MIXED

Score breakdown: P/E: 1/3 · ROCE: 0/2 · Growth: 1/2 · Dividend: 0/1

Key Financials

Strengths

• Trades below book value at P/B of 0.93 and below Graham Number of ₹169.41, offering a modest margin of safety.
• Zero debt and positive free cash flow of ₹1,576 Cr provide financial stability.
• Large underwriting scale with quarterly sales of ₹12,069 Cr gives it a competitive moat.
• Recent acceleration: sales growth of 12.18%, profit growth of 20.62%, and Piotroski F-score of 7/9.
• High promoter holding of 85.44% ensures ownership stability.

Concerns

• Low ROE of 4.11% and ROCE of 3.59% indicate weak capital efficiency for a financial business.
• P/E of 20.35 is not cheap given low returns, and DCF intrinsic value of ₹164.38 is almost exactly the market price.
• Altman Z-score of 0.86 is a cautionary signal, though it is less meaningful for insurance companies.
• Dividend yield of 1.22% is thin, and minority shareholders have limited influence with only 14.56% float.

AI Analysis

New India Assura is the kind of company Graham would ask me to study patiently. The stock is ₹164.15, while book value is ₹175.94 and the Graham Number is ₹169.41. So on a historical value scale, there is a 13.05% margin of safety. But value without return is idle capital. The latest quarter shows net profit of only ₹380 Cr on sales of ₹12,069 Cr, and the trailing ROE is 4.11%. That is a weak return on equity. I want a business that can reinvest at high rates; this one cannot. The moat is scale: a large general-insurance book, zero debt, and free cash flow of ₹1,576 Cr. That gives staying power. But promoter holding is 85.44%, so minority shareholders are in the back seat. The five-year revenue CAGR is only 5.57%, though the recent 12.18% sales growth and 20.62% profit growth suggest acceleration. A P/E of 20.35 is not cheap for a low-ROE financial; DCF intrinsic value is ₹164.38, almost exactly the market price, so I see no bargain. The Piotroski F-score of 7/9 indicates improving fundamentals, and zero leverage is reassuring. Altman Z-score of 0.86 is a red flag, but that metric was built for manufacturing, not insurance, so I won't treat it as gospel. Dividend yield of 1.22% is too thin to compensate for modest returns. This is a steady, asset-backed business, but not a wonderful compounding machine. I would only be interested well below book value, not at fair value.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer