A newly promoted side are rarely favourites to challenge for the title but Monaco have spent freely in the transfer market this summer, purchasing the likes of Joao Moutinho, Radamel Falcao, James Rodriguez and many more.
However, the Italian believes that, until his side gel as a team, Paris Saint-Germain, Olympique Lyonnais and Olympique de Marseille have the edge over the Rouge et Blanc.
"I believe it is too early to ask if we can compete with PSG," Ranieri told L'Equipe.
"PSG, Lyon and Marseille look more like teams than Monaco. So we need time. It will be difficult to be champions this season.
"Give me some time. To me the most important thing is first to try to build the best group possible."
Ranieri, who has coached the likes of Chelsea, Juventus and Atletico Madrid, took charge of the principality club in May 2012 and led them back to Ligue 1 in his first season.