The Price-to-Earnings (P/E) ratio of a stock is a metric that compares a company’s current share price to its Earnings per Share (EPS). It is commonly used to assess whether a company’s stock is undervalued or overvalued by comparing its P/E ratio to the average P/E ratio of its industry.
According to reports, India’s alcohol industry is projected to reach USD 55.84 billion in 2024, growing at a 7.2% CAGR to USD 112.34 billion by 2034. This growth is driven by a young, urbanizing population and the increasing demand for alcoholic beverages, especially among younger consumers who associate alcohol with socializing and entertainment.
Here are the 3 undervalued small cap Alcoholic stocks
Associated Alcohols & Breweries Ltd
The company’s P/E ratio is 38.38, which is lower than the industry average of 41.88 indicating that the stock is trading at a lower price or is undervalued, with an EPS of Rs 30.17.
The Associated Alcohols & Breweries stocks delivered a multi-bagger return of 125 percent for 2024. The company’s revenue has increased by 48 percent year on year, from Rs 173 crore in Q2FY24 to Rs 256 crore in Q2FY25. During the same period, net profit rose by 13 percent from Rs 13.45 crore to Rs 15.32 crore.
Associated Alcohols & Breweries is a small-cap stock with a market capitalization of Rs 2,220.66 Crores. The company’s stock closed at Rs 1,111.85 per share on Wednesday, around 4 percent down from its previous close.
Founded in 1989, Associated Alcohols & Breweries Limited (AABL) has evolved from trading molasses to becoming a leading producer of IMIL and premium liquor brands. With a strong presence in multiple states, including Delhi and Madhya Pradesh, the company operates an ENA manufacturing capacity of 45 MLPA and 32 bottling lines, producing 12.5 million cases annually. AABL owns a portfolio of 9 proprietary brands and holds a significant 20-25% market share in both IMIL and IMFL products, particularly in Madhya Pradesh.
India Glycols Ltd
The company’s P/E ratio is 21.59, which is lower than the industry average of 41.88 indicating that the stock is trading at a lower price or is undervalued, With an EPS of Rs 62.64.
The stocks of India Glycols Ltd delivered a good return of 52 percent for the year 2024. The company’s revenue has increased by 23 percent year on year, from Rs 785 crore in Q2FY24 to Rs 965 crore in Q2FY25. During the same period, net profit rose by 31 percent from Rs 38 crore to Rs 50 crore.
India Glycols Ltd is a small-cap stock with a market capitalization of Rs 4,186.92 Crores. The company’s stock closed at Rs 1320 per share on Wednesday, down by around 2.4 percent from its previous close.
Founded in 1989, India Glycols Ltd is a major producer of Country Liquor and IMFL, contributing 30% of its revenue from potable alcohol as of FY 2024. The company also manufactures high-performance chemicals like Glycols, Glycol Ethers, and Acetates, serving industries such as Textile, Agrochemical, and Pharmaceuticals.
GM Breweries Ltd
The company’s P/E ratio is 10.95, which is lower than the industry average of 41.88 indicating that the stock is trading at a lower price or is undervalued, With an EPS of Rs 67.94.
The stocks of GM Breweries Ltd delivered a decent return of 38 percent for the year 2024. The company’s revenue has increased by 2 percent year on year, from Rs 164 crore in Q3FY24 to Rs 166 crore in Q3FY25. During the same period, net profit declined by 2.8 percent from Rs 22.6 crore to Rs 21.97 crore, due to an increase in cost of raw materials by 6%.
GM Breweries Ltd is a small-cap stock with a market capitalization of Rs 1,699.7 Crores. The company’s stock closed at Rs 730.5 per share on Wednesday, down by around 1.7 percent from its previous close.
Founded in 1981 by Shri Jimmy William Almeida, G.M. Breweries Limited (GMBL) manufactures and markets Country Liquor (CL) and Indian Made Foreign Liquor (IMFL). With a fully automated bottling plant in Virar, Maharashtra, it produces 50,000 cases daily. GMBL pioneered the introduction of 180 ml bottles and PET bottles in the country’s liquor industry.
Written by Adhvaitha Nayani
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