The P/E (Price to Earnings) ratio compares a company’s current share price to its earnings per share (EPS), which is a generally used measure to determine a stock’s value.
As per reports, alcohol revenues represent 1.2 percent of India’s nominal GDP, 7.7 percent of the total tax collection, and 11.7 percent of the nation’s indirect tax revenue. The sector contributes a significant 24.6 percent of the overall tax revenues of the state,
Moreover, India’s Alcohol Beverage market size of $52.4 billion is targeted to touch $64 billion by 2030, according to a report by the International Spirits & Wines Association of India (ISWAI).
Here are two Undervalued Multibagger Alcohol Stocks
Tilaknagar Industries Ltd
Tilaknagar Industries Ltd is a small-cap stock with a market capitalization of Rs 5,355 crores. The company’s shares closed at Rs 278.40 per share, down 0.71 percent on Wednesday from the previous close price.
The company’s P/E ratio is 26.65, which is lower than the industry’s P/E ratio of 63.45, indicating that the stock is trading at a lower price or is undervalued, With an EPS of 10.28.
Tilaknagar Industries stock delivered a multibagger return of 184 percent last year, This shows that a shareholder investment of Rs 1 lakh in the company would be worth Rs 2.84 lakhs in a year.
Tilaknagar Industries’ margins have slightly improved with a net profit margin of 12.87 percent and operating margin of 9.64 percent and the company has a debt-to-equity ratio of 0.52.
The company’s revenue has increased by 29 percent year on year, from Rs 274 crore in Q2FY23 to Rs 354 crore in Q2FY24. During the same period, net profit jumped by 185 percent from Rs 13 crore to Rs 37 crore.
Tilaknagar Industries Ltd. is primarily engaged in the manufacturing and sale of Indian Made Foreign Liquor (IMFL). The company has a diverse portfolio of brands in various liquor categories including brandy, whisky, vodka, gin, and rum.
Aurangabad Distillery Ltd.
Aurangabad Distillery Ltd is a small-cap stock with a market capitalization of Rs 273 crores. The company’s shares closed at Rs 332.95 per share, up 5 percent on Wednesday from the previous close price.
The company’s P/E ratio is 12.37, which is lower than the industry’s P/E ratio of 69.45, indicating that the stock is trading at a lower price or is undervalued, With an EPS of 20.44.
Aurangabad Distillery Ltd stock delivered a multibagger return of 103 percent last year, This shows that a shareholder investment of Rs 1 lakh in the company would be worth Rs 2.03 lakhs in a year.
Aurangabad Distillery Ltd margins have greatly improved with a net profit margin of 14.11 percent and operating margin of 23.90 percent and the company has a debt-to-equity ratio of 0.63.
The company’s revenue has increased by 17 percent year on year, from Rs 101 crore in FY 21-22 to Rs 118 crore in FY 22-23. During the same period, net profit jumped by 100 percent from Rs 8 crore to Rs 16 crore.
Aurangabad Distillery Limited is a manufacturer of non-potable alcohol. The Company is engaged in the production of various types of alcohol. The Company’s products include rectified spirit, denatured spirit, neutral alcohol, potash, bio-potash, and many others.
Written by Omkar Chitnis
