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Raama FinanceBOM:538540 +1.85%77 Return-on-Tangible-Equity is 36.14% as of Mar. 2026, which is 10529% above its 10-year median of 0.34. GuruFocus rates BOM:538540 with a GF Score™ of 77/100 and a GF Value™ of ₹32.51 (Significantly Undervalued). The stock has 2 warning signs investors should review. Among 526 Credit Services companies, Raama Finance ranks better than 83.46% on this metric.
Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Raama Finance's annualized net income for the quarter that ended in Mar. 2026 was ₹105.1 Mil. Raama Finance's average shareholder tangible equity for the quarter that ended in Mar. 2026 was ₹290.8 Mil. Therefore, Raama Finance's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 36.14%.
The historical rank and industry rank for Raama Finance's Return-on-Tangible-Equity or its related term are showing as below:
BOM:538540'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 0.2 Med: 0.34 Max: 19.45
Current: 19.45
During the past 13 years, Raama Finance's highest Return-on-Tangible-Equity was 19.45%. The lowest was 0.20%. And the median was 0.34%.
BOM:538540's Return-on-Tangible-Equity is ranked better than 83.46% of 526
companies
in the Credit Services industry
Industry Median: 7.055
vs BOM:538540: 19.45
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
Raama Finance Return-on-Tangible-Equity Related Terms
Raama Finance Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Raama Finance's Return-on-Tangible-Equity can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
BOM:538540 vs V, MA, AXP: Return-on-Tangible-Equity Comparison
For the Credit Services subindustry, Raama Finance's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Raama Finance Return-on-Tangible-Equity vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Raama Finance's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Raama Finance's Return-on-Tangible-Equity falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 36.14% mean?
Raama Finance (BOM:538540) has a Return-on-Tangible-Equity of 36.14% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Raama Finance and its competitors. This is 10529% above median its historical median of 0.34. Over the past decade, Raama Finance's Return-on-Tangible-Equity has ranged from 0.20 to 19.45. According to the industry distribution chart, Raama Finance ranks #87 out of 526 companies in the Credit Services industry, placing it in the top 16.5%.
Is Raama Finance's Return-on-Tangible-Equity too high?
Raama Finance's current Return-on-Tangible-Equity of 36.14% is 10529% above median its 10-year median of 0.34. Over the past 10 years, this metric has ranged from a low of 0.20 to a high of 19.45. The Credit Services industry median Return-on-Tangible-Equity is 7.06. Raama Finance's value of 36.14% is 412.3% above this industry median. Based on the distribution chart, Raama Finance ranks #87 out of 526 companies in the Credit Services industry, which is in the top quartile — a strong position relative to peers. Overall, Raama Finance has a GF Score™ of 77/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Raama Finance's Return-on-Tangible-Equity compare to V and MA?
According to the Credit Services industry distribution chart, Raama Finance ranks #87 out of 526 companies for Return-on-Tangible-Equity. This places Raama Finance in the top 17% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 7.06. Raama Finance's value of 36.14% is 412.3% above this benchmark. Historically, Raama Finance's own Return-on-Tangible-Equity has ranged from 0.20 to 19.45 over the past decade. While the company's 10-year median is 0.34 vs. the industry median of 7.06, Raama Finance has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Credit Services company?
The median Return-on-Tangible-Equity among Credit Services companies is 7.06, based on 526 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Raama Finance's current Return-on-Tangible-Equity of 36.14% is 412.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Raama Finance and its competitors. For the Credit Services industry, the median Return-on-Tangible-Equity is 7.06 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Raama Finance's current Return-on-Tangible-Equity is 36.14%, which is 10529% above median its own 10-year median of 0.34. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Raama Finance stock overvalued right now?
Based on GuruFocus' analysis, Raama Finance (BOM:538540) is currently considered Significantly Undervalued. The stock's GF Value™ is ₹32.51, compared to a current price of ₹19.25 — trading 40.8% below its estimated fair value. The current Return-on-Tangible-Equity is 36.14%, which is 10529% above median its 10-year median of 0.34 and 412.3% above the Credit Services industry median of 7.06. Raama Finance's overall GF Score™ is 77/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For Raama Finance (BOM:538540), the current Return-on-Tangible-Equity is 36.14% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Raama Finance (BOM:538540) Overvalued in 2026?
Based on GuruFocus' analysis, Raama Finance stock appears to be undervalued.
The current stock price of ₹19.25 is trading 40.8% below its estimated GF Value™ of ₹32.51.
GuruFocus considers Raama Finance to be Significantly Undervalued.
Key valuation signals for BOM:538540:
Return-on-Tangible-Equity: 36.14% (10529% above median its 10-year median of 0.34)
GF Value™: ₹32.51 vs. price of ₹19.25 (40.8% below fair value)
Industry Position: 412.3% above the Credit Services median (#87 of 526)
No single metric tells the full story. See the BOM:538540 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Raama Finance Ltd, formerly known as Ramchandra Leasing & Finance Ltd, is a non-banking finance company. It is engaged in commercial loan activities. Its services include leasing (short term and long term) and hire purchase. It provides financial assistance in the form of loans (secured and unsecured) to corporate bodies. The company offers working capital term loan for a term period of a year and two.
77GF Score
Get the complete analysis for BOM:538540
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