Price to book value is known as one of the valuation metrics to understand and analyse a stock on the basis of its increasing or decreasing value. In simple terms, it is a comparison of a share’s market price to the company’s book value of equity. Investing in a company with a price to book value ratio of 2 or less than 2 is considered a solid and potential investment.
Here are three mid cap stocks which could be considered for investments based on their price to book value ratio.
Tata Chemicals
Share prices of Tata Chemicals opened at Rs 1075.15. It gained nearly 2% today and reached its intra- day high of Rs. 1,091.45 per share. The stock gave a return of 5.97% in the last six months and 260.78% in the last three years.
Tata Chemicals is a part of Tata Group conglomerate. It is a manufacturer of chemical products and caters to industries such as pharma, bakeries, glass, and many more. It is a global company providing services to several continents including North America, Europe, Asia and Middle East.
The company has a market capitalization of Rs. 27,266 crore. On a QoQ basis, it had a revenue of Rs. 4407 crore in Q4FY23 which decreased by 4.29% to Rs. 4218 crore in Q1FY24. The net profit which was Rs. 709 crore in Q4FY23 has decreased by 24.96% to Rs. 532 crore in Q1FY24. It has a good P/E ratio of 11.31 against its industry average P/E ratio of 12.14. Its price to book value for FY23 is 1.26
Exide Industries
Share prices of Exide Industries opened at Rs. 265.75. It gained nearly 2% today and reached its intra- day high of Rs. 269.70 per share. The stock gave a return of 43.18% and 54.15% in the last six months and one year.
Exide Industries was incorporated in 1947 and headquartered in Kolkata, West Bengal. The company is the largest manufacturer of power storage solutions and storage batteries. It exports its products to more than 50 countries worldwide.
The company has a market capitalization of Rs. 22,576 crore. On a QoQ basis, the revenue increased by 15.47% to Rs. 4245.48 crore in Q1FY24 from Rs. 3676.76 crore in Q4FY23. Its net profit increased by 23.42% to Rs. 222.31 crore in Q1FY24 from Rs. 180.12 crore in Q4FY23. It has a low debt- ratio of 0.03. Its price to book value for FY23 is 2.
UPL Limited
Share prices of UPL Limited opened at Rs. 605 levels. It gained nearly 1% today and reached its intra- day high of Rs. 606.95 per share. The stock returned 21.95% and 28.62% in the last three and five years.
UPL Limited is a multinational company incorporated in the year of 1969. It manufactures chemical products such as agrochemicals, pesticides and industrial chemicals. Its non- agro products include marketing chemicals and manufacturing products such as insecticides, nutrifeeds, herbicides, and many more.
The company has a market capitalization of Rs. 45,265 crore. On a QoQ basis, it had a revenue of Rs. 16,569 in Q4FY23 which decreased by 45.91% to Rs. 8,963 crore in Q1FY24. The net profit which was Rs. 792 crore in Q4FY23 has decreased by 79.04% to Rs. 166 crore in Q1FY24. It has a good P/E ratio of 15.34 against its industry average P/E ratio of 36.74. Its price to book value for FY23 is 1.62
Written by Bhumika Khandelwal
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