Fundamentally strong stocks trading at a discount present attractive investment opportunities, especially when their price-to-earnings (P/E) ratio is lower than the industry average. These stocks often have solid financials, consistent earnings, and growth potential, making them undervalued picks for investors seeking long-term gains with reduced downside risk.
Here are the fundamentally strong stocks trading at a discount with a P/E less than the industry:
1. Colgate-Palmolive (India) Ltd
Colgate-Palmolive (India) Limited is engaged in manufacturing/trading toothpaste, toothpowder, toothbrush, and mouthwash under the Colgate brand and personal care products under the Palmolive brand. The Company operates in a single segment: Personal Care (including Oral Care).
With a market capitalization of Rs 67,398.04 crore, the shares were trading at Rs 2,477 per share, increasing around 0.76 percent as compared to the previous closing price. Moreover, the stock might be deemed undervalued, given its PE ratio of 46.1 times, in contrast to the industry average of 55 times.
The company hit its 52-week or all-time high in October 2024 at Rs.3,893 apiece and, comparing the same with the current stock price prevailing in the market, there is a discount of approximately 36 percent.
2. Life Insurance Corporation of India
Life Insurance Corporation of India is engaged in the business of life insurance in and outside India. It offers a range of individual and group insurance solutions including participating, non-participating, and unit-linked lines of businesses.
With a market capitalization of Rs 4.91 lakh crore, the shares were trading at Rs 777.15 per share, decreasing around 0.53 percent as compared to the previous closing price. Moreover, the stock might be deemed undervalued, given its PE ratio of 22.8 times, in contrast to the industry average of 29.3 times.
The company hit its 52-week or all-time high in August 2024 at Rs.1,221 apiece and, comparing the same with the current stock price prevailing in the market, there is a discount of approximately 57 percent.
3. Castrol India Ltd
Castrol India Limited is principally engaged in the business of manufacturing and marketing automotive and industrial lubricants and related services. Its geographical segments include India and Outside India.
With a market capitalization of Rs 21,137.55 crore, the shares were trading at Rs 213.70 per share, decreasing around 0.72 percent as compared to the previous closing price. Moreover, the stock might be deemed undervalued, given its PE ratio of 11.4 times, in contrast to the industry average of 29.3 times.
The company hit its 52-week or all-time high in August 2024 at Rs. 284 apiece and, comparing the same with the current stock price prevailing in the market, there is a discount of approximately 25 percent.
Also read: Fundamentally strong stocks that are trading in oversold zone with RSI less than 30 to keep an eye on
4. Hindustan Aeronautics Ltd
Hindustan Aeronautics Limited is an Indian firm that designs, develops, manufactures, repairs, overhauls, upgrades and services a variety of goods such as airplanes, helicopters, aero-engines, avionics, accessories, and aerospace structures.
With a market capitalization of Rs 2.23 lakh crore, the shares were trading at Rs 3,348.15 per share, decreasing around 0.64 percent as compared to the previous closing price. Moreover, the stock might be deemed undervalued, given its PE ratio of 25.8 times, in contrast to the industry average of 62.0 times.
The company hit its 52-week or all-time high in October 2024 at Rs. 5,675.00 apiece and, comparing the same with the current stock price prevailing in the market, there is a discount of approximately 41 percent.
5. Mazagon Dock Shipbuilders Ltd
Mazagon Dock Shipbuilders Limited is engaged in building and repairing of ships, submarines, various types of vessels, and related engineering products. The Company is into the construction of warships and submarines. It is also engaged in the production of defense equipment.
With a market capitalization of Rs 87,531.44 crore, the shares were trading at Rs 2,169.95 per share, increasing around 2.32 percent as compared to the previous closing price. Moreover, the stock might be deemed undervalued, given its PE ratio of 31.9 times, in contrast to the industry average of 42.1 times.
The company hit its 52-week or all-time high in July 2024 at Rs. 2,929.98 apiece and, comparing the same with the current stock price prevailing in the market, there is a discount of approximately 25 percent.
Written by Abhishek Singh
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
