The Price-to-Earnings Growth (PEG) ratio is a financial metric that combines a company’s price-to-earnings (P/E) ratio with its earnings growth rate. It is calculated by dividing the P/E ratio by the company’s expected earnings growth rate.
A PEG ratio of 1 is generally considered to indicate that a stock is fairly valued, as the price aligns with the company’s growth rate. A ratio below 1 suggests that the stock may be undervalued relative to its growth potential, while a ratio above 1 could indicate overvaluation.
The stocks to watch out for
Avantel Limited
Avantel Limited is an Indian technology company that specializes in providing satellite communication services, including research, development, and manufacturing of satellite communication systems. The company also offers services in the fields of telecom, defense, and aerospace.
With a market capitalization of Rs. 2,914 crores on Friday, the company’s PEG ratio stood at 0.98, with an ROE of 39.15 percent and ROCE of 47.50 percent, along with a debt-to-equity ratio of 0.08.
Lloyds Engineering Works Ltd
Lloyds Engineering Works Ltd is an engineering company based in India, engaged in the manufacturing of engineering components and equipment for various industries. It primarily focuses on serving sectors such as automobile, power, and engineering services, and the company also deals in designing, fabricating, and supplying specialized products.
With a market capitalization of Rs. 7,114 crores on Friday, the company’s PEG ratio stood at 0.73, with an ROE of 26.23 percent and ROCE of 28.33 percent, along with a debt-to-equity ratio of 0.15.
Radhika Jeweltech Ltd
Radhika Jeweltech Ltd is a leading manufacturer and wholesaler of diamond jewelry and precious gemstones in India. The company is involved in the designing, manufacturing, and trading of gold, silver, and diamond jewelry. It serves both the domestic and international markets, specializing in the creation of fine jewelry.
With a market capitalization of Rs. 1,078 crores on Friday, the company’s PEG ratio stood at 0.38, with an ROE of 20.6 percent and ROCE of 24.6 percent, along with a debt-to-equity ratio of 0.18.
Magellanic Cloud Ltd
With a market capitalization of Rs. 3,150 crores on Friday, the company’s PEG ratio stood at 0.40, with an ROE of 29.2 percent and ROCE of 27.0 percent, along with a debt-to-equity ratio of 0.52.
Magellanic Cloud Ltd is a technology-driven company specializing in the development and manufacturing of advanced software solutions and services. It focuses on providing innovative IT services to industries like healthcare, education, and finance, and the company aims to empower businesses through digital transformation and cutting-edge technologies.
Bombay Super Hybrid Seeds Ltd
Bombay Super Hybrid Seeds Ltd is an Indian company engaged in the production and marketing of hybrid seeds for various crops like vegetables and grains. The company focuses on providing high-quality seeds to farmers to improve crop yield and quality.
With a market capitalization of Rs. 1,433 crores on Friday, the company’s PEG ratio stood at 0.92, with an ROE of 33.0 percent and ROCE of 23.9 percent, along with a debt-to-equity ratio of 0.41.
Written by Sridhar J
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