DCM Shriram Ltd.
ISIN: INE499A01024 • Market Cap: ₹16,370 Cr
The 5-Pillar Quality Audit for DCM Shriram Ltd.
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (10.5%), Return on Capital Employed (11.5%), and equity compounding (11.1%).
2. Financial Health & Solvency
Weight: 25%Debt-to-Equity is 0.36 with comfortable interest coverage and clean working capital.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (10.1%) and 3Y PAT CAGR (47.5%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 11.43 vs PEG of 0.65 and Dividend Yield of 1.1%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 66.5%, backed by 12.3% institutional ownership.
Key Fundamental Strengths
High-Velocity Profit Compounding (3Y PAT CAGR: 47.5%)
Net earnings have compounded at 47.5% annualized, demonstrating operating leverage.
Attractive Valuation Margin (P/E: 11.43)
Trading at a P/E multiple of 11.43, the stock offers a favourable risk-reward entry for quality compounding.
Areas to Watch & Potential Risks
Subdued Capital Efficiency (ROCE: 11.5%)
A sub-12% ROCE suggests return on capital barely exceeds the company's weighted average cost of capital (WACC).
Sectoral & Macro Headwinds (Diversified)
Subject to broader cyclical demand, raw material price shifts, and regulatory frameworks governing the Diversified space.
Quantitative Strategy Eligibility
Checking DCMSHRIRAM 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)
Qualifies for Indian Quality Indices with overall score of 73/100 and clean gearing.
GARP / Value-Growth Blend
Valuation multiple or return metrics require further cyclical pullback.
Diversified Sector Peer Comparison
Compare DCMSHRIRAM directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| DCM Shriram Ltd. (DCMSHRIRAM)Current | 73/100 | ₹16,370 Cr | 11.43 | 11.5% | 0.36 | — |
| Godrej Industries Ltd. (GODREJIND) | 58/100 | ₹40,998 Cr | 34.87 | 12.1% | 4.57 | View |
| 3M India Ltd. (3MINDIA) | 78/100 | ₹37,667 Cr | 65.20 | 49.8% | 0.00 | View |
Frequently Asked Questions: DCM Shriram Ltd.
Q:What is the 5-Pillar Fundamental Score for DCM Shriram Ltd. (DCMSHRIRAM)?
DCM Shriram Ltd. has a RupeeTools Fundamental Score of 73/100, placing it in the 'Solid & Healthy' category. Its pillar scores are: Profitability (50/100), Financial Health (81/100), Growth (85/100), Valuation (85/100), and Ownership Quality (72/100).
Q:Is DCMSHRIRAM fundamentally strong for long-term investment?
Yes, DCMSHRIRAM exhibits solid fundamental strength with a 73/100 score, driven by a return on equity of 11.1% and a debt-to-equity ratio of 0.36.
Q:Does DCMSHRIRAM pass the Coffee Can Investing filter?
No. DCMSHRIRAM does not currently meet the strict 15% ROCE and 10% sustained topline compounding threshold mandated by the Coffee Can investing framework.
Q:How does DCMSHRIRAM compare against other Diversified peers?
Within India's Diversified sector, DCMSHRIRAM trades at a P/E of 11.43 and generates an ROCE of 11.5%. Compare its 5-Pillar score of 73/100 against top sector peers like Godrej Industries Ltd. (58/100), 3M India Ltd. (78/100).
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.