A company of a ‘fundamentally strong’ nature portrays a certain set of characteristics that include lower leverage ratios, strong financials, etc.
Listed below is one such fundamentally strong stock under the ‘sugar’ industry which is at a discount of more than 30 percent from its 52-week high level:
E.I.D Parry (India) Limited
With a market capitalization of Rs 8,148.06 crores, the stocks of E.I.D Parry (India) Limited closed at Rs 459 apiece on Monday indicating a gain of approximately 0.70 percent as compared to the previous close of Rs 455.85.
The company’s stock hit its 52-week high mark in October 2022 at a price of Rs 673.3, and, compared to the same, the current price levels are at a discount of around 32 percent.
The company, on an annual basis, has been successful in improving its prime business indicators such as operating revenues and net profits. The operating revenues rose from Rs 23,521.06 crores during FY21-22 to Rs 35,243.8 crores during FY22-23, and the net profits moved up from Rs 906.83 crores to Rs 947.48 crores during the same time horizon.
In addition to the above, the company’s profitability ratios have improved with the return on equity (RoE) increasing marginally from 31.83 percent during FY21-22 to 32.10 percent during FY22-23, and, the return on capital employed (RoCE) taking a shift from 39.57 percent to 42.65 percent.
Since the last three financial years, the company’s debt-to-equity ratio remained at the desirable levels with the most recent ratio of 0.20 times reported during FY22-23.
The latest shareholding data of the company exhibits the Promoters holding a 44.51 percent stake, and the Foreign Institutional Investors (FIIs) holding a 10.4 percent stake in the company.
Headquartered in India, E.I.D Parry (India) Limited is engaged in the business of producing sugar. The company conducts business through four broad segments comprising sugar, distillery, cogeneration, and nutraceuticals.
It has a global footprint with operations spanning India, Europe, North America, and other regions. The Indian operations constitute the majority of the company’s sales.
Written by Amit Madnani
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