Emerging growth stocks with low debt and low price-to-earnings (P/E) ratios offer investors a compelling opportunity for capital appreciation while minimizing financial risk. These companies typically exhibit strong fundamentals, making them attractive options for those seeking sustainable growth.
Here are a few such growth stocks with low debt and trading at a P/E ratio below the industry average:
Life Insurance Corporation of India
With a market capitalization of Rs.6.08 lakh crore, Life Insurance Corporation of India’s (LIC) share price opened at Rs.973.25 per share on Thursday, up 0.22 percent from its previous close.
The company has a P/E ratio of 14.6, lower than industry P/E of 49.3, signifying that the stock is trading at a lower price, and has an EPS (Earning Per Share) of Rs.66.1.
LIC has significantly reduced its debt from Rs.2,53,414 crore in March 2020 to nil by March 2024, reflecting its strong financial discipline and focus on debt elimination.
In terms of financial performance, LIC reported a 12 percent year-on-year increase in revenue for Q1 FY25, reaching Rs.2,12,083 crore. Net profit also increased 10 percent to Rs.10,527 crore.
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ITC Limited
With a market capitalization of Rs.6.37 lakh crore, ITC Limited’s share price opened at Rs.494.95 per share on Thursday, up 0.7 percent from its previous close.
The company has a P/E ratio of 31.1, lower than industry P/E of 34.2, signifying that the stock is trading at a lower price, and has an EPS of Rs.16.4.
ITC’s debt stands at Rs.303 crore as of FY24, a slight reduction from Rs.306 crore in FY23. This marginal decrease highlights the company’s stable financial management and conservative approach to leveraging debt.
In terms of financial performance, ITC reported an 8 percent year-on-year increase in revenue for Q1 FY25, reaching Rs.18,457 crore. However, net profit declined slightly by 0.25 percent to Rs.5,177 crore.
Indian Energy Exchange Ltd
With a market capitalization of Rs.18,155 crore, Indian Energy Exchange Ltd (IEX) share price opened at Rs.205.85 per share on Thursday, up 1.1 percent from its previous close.
The company has a P/E ratio of 50.2, lower than industry P/E of 61.2, signifying that the stock is trading at a lower price, and has an EPS of Rs.4.05.
IEX reduced its debt from Rs.14 crore in March 2023 to Rs.10 crore in March 2024. This reduction underscores the company’s commitment to maintaining a lean balance sheet and improving its financial health.
In terms of financial performance, IEX reported a 20 percent year-on-year increase in revenue for Q1 FY25, reaching Rs.124 crore. Net profit also increased 26 percent to Rs.93 crore.
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Written by – Siddesh S Raskar
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