Canara Bank
ISIN: INE476A01022 • Market Cap: ₹1.17 Lakh Cr
The 5-Pillar Quality Audit for Canara Bank
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (21.7%), Return on Capital Employed (14.5%), and equity compounding (18.0%).
2. Financial Health & Solvency
Weight: 25%Assesses capital adequacy, provisioning coverage, and asset liability structure.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (2.8%) and 3Y PAT CAGR (7.5%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 5.87 vs PEG of 0.46 and Dividend Yield of 3.3%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 62.9%, backed by 24.6% institutional ownership.
Key Fundamental Strengths
Robust Equity Compounding (ROE: 18.0%)
Shareholder equity compounds at a healthy 18.0%, exceeding average Indian equity benchmarks.
Attractive Valuation Margin (P/E: 5.87)
Trading at a P/E multiple of 5.87, the stock offers a favourable risk-reward entry for quality compounding.
Areas to Watch & Potential Risks
Topline Stagnation (3Y Sales CAGR: 2.8%)
Revenue growth has slowed below inflation rates, indicating cyclical demand slowdown or saturated core markets.
Sectoral & Macro Headwinds (Financial Services)
Subject to broader cyclical demand, raw material price shifts, and regulatory frameworks governing the Financial Services space.
Quantitative Strategy Eligibility
Checking CANBK against established Indian wealth creation frameworks:
Coffee Can Investing Framework
Fails 10%+ revenue growth or 15%+ minimum capital return benchmark over historical periods.
Quality Factor Screener (High RoIC + Low Debt)
Scorecard of 69/100 or leverage profile sits below strict quality index hurdles.
GARP / Value-Growth Blend
Provides balanced valuation margin with strong profitability scores.
Financial Services Sector Peer Comparison
Compare CANBK directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| Canara Bank (CANBK)Current | 69/100 | ₹1.17 Lakh Cr | 5.87 | 14.5% | N/A | — |
| HDFC Bank Ltd. (HDFCBANK) | 74/100 | ₹11.10 Lakh Cr | 14.05 | 12.8% | 1.01 | View |
| ICICI Bank Ltd. (ICICIBANK) | 76/100 | ₹10.06 Lakh Cr | 17.94 | 16.5% | 0.62 | View |
| State Bank of India (SBIN) | 71/100 | ₹9.66 Lakh Cr | 11.20 | 12.2% | 1.38 | View |
| Bajaj Finance Ltd. (BAJFINANCE) | 68/100 | ₹6.72 Lakh Cr | 33.07 | 13.9% | 3.86 | View |
| Life Insurance Corporation of India (LICI) | 87/100 | ₹5.22 Lakh Cr | 8.70 | 37.8% | 0.00 | View |
Frequently Asked Questions: Canara Bank
Q:What is the 5-Pillar Fundamental Score for Canara Bank (CANBK)?
Canara Bank has a RupeeTools Fundamental Score of 69/100, placing it in the 'Solid & Healthy' category. Its pillar scores are: Profitability (84/100), Financial Health (37/100), Growth (48/100), Valuation (95/100), and Ownership Quality (80/100).
Q:Is CANBK fundamentally strong for long-term investment?
CANBK currently holds a moderate quality rating of 69/100. While it operates in the Financial Services sector, investors should monitor its debt health before initiating long-term positions.
Q:Does CANBK pass the Coffee Can Investing filter?
No. CANBK does not currently meet the strict 15% ROCE and 10% sustained topline compounding threshold mandated by the Coffee Can investing framework.
Q:How does CANBK compare against other Financial Services peers?
Within India's Financial Services sector, CANBK trades at a P/E of 5.87 and generates an ROCE of 14.5%. Compare its 5-Pillar score of 69/100 against top sector peers like HDFC Bank Ltd. (74/100), ICICI Bank Ltd. (76/100).
Regulatory & SEBI Research Analyst Compliance Disclaimer:
This 5-pillar fundamental score is an automated quantitative health check generated purely from historical public financial statements, corporate filings, and exchange disclosures for educational and informational purposes only. It does NOT constitute investment advice, a stock recommendation, or a solicitation to buy or sell securities. RupeeTools is not a SEBI-registered Research Analyst. Please consult a SEBI-registered financial advisor before making investment decisions.