Synopsis:
Page Industries, IRCTC, P&G Hygiene, KPIT Tech, and Berger Paints. These companies have a proven track record of strong returns, solid business models, and market leadership in their sectors. With current P/E ratios below their 5-year median levels, they may offer value for patient investors.
Some fundamentally strong companies with solid financials and proven track records are now trading below their historical valuation multiples. This means investors can access quality businesses at prices lower than what the market has typically paid in the past. Such situations are rare, as strong fundamentals usually command a premium.
1. Procter & Gamble Hygiene and Health Care
Procter & Gamble Hygiene and Health Care Limited is engaged in the manufacturing and selling of branded packaged fast-moving consumer goods in the femcare and healthcare businesses. Its portfolio includes WHISPER – India’s leading Feminine Hygiene brand, VICKS – India’s No. 1 healthcare brand, and Old Spice.
The stock is currently trading at an attractive P/E multiple of 52.88x, much below its 5-Year Median P/E of 75.29x. It has delivered an ROE and ROCE of 75.67 percent and 103.79 percent respectively.
2. Page Industries
Page Industries holds the exclusive license for Jockey in India and leads the market in premium innerwear, athleisure, and loungewear. Its strong brand recognition, wide retail presence, and growing product lineup contribute to its ongoing success.
The stock is currently trading at an attractive P/E multiple of 66x, much below its 5-Year Median P/E of 82.38x. It has delivered an ROE and ROCE of 48.54 percent and 59.40 percent respectively.
3. Indian Railway Catering & Tourism Corporation
IRCTC is a public sector company that manages online railway ticketing, catering, and tourism services across India. With a stronghold on online train bookings and a move into tourism and packaged drinking water, IRCTC is enjoying steady revenue growth.
The stock is currently trading at an attractive P/E multiple of 43.59x, much below its 5-Year Median P/E of 65.56x. It has delivered an ROE and ROCE of 37.16 percent and 49.03 percent respectively.
4. KPIT Technologies
KPIT Technologies Limited is a worldwide leader in automotive software and digital solutions, catering to clients from the Americas to Europe, the UK, and beyond. The company has its sights set on the future, focusing on cutting-edge areas like autonomous driving, ADAS, vehicle electrification, and software-defined vehicle solutions.
The stock is currently trading at an attractive P/E multiple of 41.23x, much below its 5-Year Median P/E of 58.20x. It has delivered an ROE and ROCE of 33.20 percent and 40.88 percent respectively.
5. Berger Paints India
Berger Paints stands out as a top paint manufacturer in India, providing decorative, industrial, and protective coatings. With a solid distribution network, increasing housing demand, and a trend towards premium products, the company is steadily gaining market share in the paint industry.
The stock is currently trading at an attractive P/E multiple of 54.19x, much below its 5-Year Median P/E of 67.26x. It has delivered an ROE and ROCE of 20.26 percent and 24.90 percent respectively.
In conclusion, these stocks are trading at prices lower than their historical valuations and have solid fundamentals, reliable business models, and strong positions in the market. This could be a great chance for long-term investors, but it’s crucial to take a close look at these businesses, understand the potential risks, and make sure they fit with your investment goals before jumping in to buy.
Written by Satyajeet Mukherjee
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