As per the Industry experts, mid-caps are able to produce better returns because they are quicker to act than large caps and more financially stable than small caps.
An important metric used to analyze whether a stock is overvalued or undervalued is the Price-to-Earnings (PE) Ratio. It measures a stock’s current share price relative to its earnings per share (EPS). A high PE ratio could mean that a company’s stock is overvalued while a lower PE indicates that the company is undervalued compared to its peers or the industry average.
Here are three midcap stocks that have a low PE ratio and analysts see an upside of up to 98%:
Exide Industries Limited
The shares of Exide Industries Ltd closed 0.6% down at Rs 157 on Wednesday. In the past month, the stock has gained more than 10%. However, the stock is down by 7% YTD.
The company has a PE ratio of 2.95 whereas the industry PE for the company is 4.63. It has the lowest PE among its competitors.
Brokerage firm Sharekhan has a buy rating on the stock with a target of Rs 183 which represents an upside of 17% from the current levels.
In Q1FY22, the company earned a revenue of Rs 4021 Crores up from Rs 3542 Crores which it earned in the same period a year ago. Its net profit increased multifold and stand at Rs 202 Crores in this quarter compared to Rs 31 Crores which it earned in the year-ago period.
Exide Industries Ltd is an Indian multinational storage battery manufacturer and life insurance company. It is the largest manufacturer of automotive and industrial lead-acid batteries in India and the fourth largest in the world.
The stock has a market capitalization of Rs 13,379 crores.
CESC Limited
The shares of CESC Limited closed 3.2% higher at Rs 80 on Wednesday. In the past month, the stock has gained more than 11%. However, the stock is down by 8% YTD.
The company has a PE ratio of 7.87 whereas the industry PE for the company is 13.65. It has the lowest PE among its competitors.
Brokerage firm HDFC Securities has a buy rating on the stock with a target of Rs 113 which represents an upside of 42% from the current levels.
The company is yet to publish its Q1 results for FY23. On a yearly basis, CESC earned a revenue of Rs 12,543 Crores in FY22 up from Rs 11,638 Crores which it earned in FY21. Their net profit stood at Rs 1404 Crores up from Rs 1362 crores in the year prior.
The Calcutta Electric Supply Corporation (CESC) is a Kolkata-based electricity generation company. It is a part of the RP-Sanjiv Goenka Group.
The stock has a market capitalization of Rs 10,697 crores.
Jindal Stainless Limited
The shares of Jindal Stainless Limited closed 2.06% down at Rs 116 on Wednesday. In the past month, the stock has gained more than 16%. However, the stock is down by 40% YTD.
The company has a PE ratio of 3.23 whereas the industry PE for the company is 6.90. It has the lowest PE among its competitors.
Brokerage firm Centrum Broking has a buy rating on the stock with a target of Rs 229 which represents an upside of 98% from the current levels.
In Q1FY23, the company reported a revenue of Rs 5474 crores as against Rs 4032 Crores which it earned in the same period a year ago. The net profit of the company was at Rs 302 Crores up from Rs 281 crores in Q1FY22.
Jindal Stainless Ltd, part of the Jindal group, is one of the largest manufacturers of Stainless Steel flat products, in Austenitic, Ferritic, Martensitic, and Duplex grades in India used in a variety of industries like automobile, railways, construction, and consumer goods.
The stock has a market capitalization of Rs 6,129 crores.
Written by – Anoushka Roy
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