The P/E (Price to Earnings) ratio compares a company’s current share price to its earnings per share (EPS), which is generally used to determine a stock’s value. This comparison helps to understand whether a stock is overvalued or undervalued.
A company with a lower P/E ratio is better than an Industry P/E ratio, which indicates investors are paying less money for every dollar of earnings generated by a firm. This method supports investors in making informed decisions before investing in companies.
Here are the three financially strong stocks under Rs 50, with P/E less than Industry
PTC India Financial Services Ltd
PTC India Financial Services is a small-cap stock with a market capitalization of Rs 2,774 crores. The company’s shares were trading at Rs 43.25 per share, down 0.46 percent on Monday from the previous close price.
The company’s P/E ratio is 16.98, which is lower than the industry’s P/E ratio of 18.93, indicating that the stock is trading at a lower price or the stock is undervalued.
PTC India Financial Services shares have gained 116 percent in the last six months and 168 percent in a year.
In the recent financial year, the company’s return on equity was reported at 7.19 percent, and its return on capital employed at 26.28 percent. While the company has a debt-to-equity ratio of 2.09.
In the case of margin ratios, the company’s gross profit margin stands at 84.76 percent and operating margin ratio of 83.99 percent.
The company’s revenue has decreased by 17 percent yearly, from Rs 968 crore in FY 21-22 to Rs 797 crore in FY 22-23. During the same period, net profit increased by 35 percent from Rs 130 crore to Rs 176 crore.
PTC India Financial Services is an NBFC that offers debt assistance to projects and structures the debt assistance taking into consideration factors like the needs of the borrowing entity, the market conditions, regulatory requirements, risks, and rewards from the projects.
Additionally, the Company invests in equity or gives debt to power projects in generation, transmission, distribution, and fuel sources, fuel-related infrastructure, equipment manufacturers, and engineering.
Pasupati Acrylon Ltd
Pasupati Acrylon is a micro-cap stock with a market capitalization of Rs 341 crores. The company’s shares were trading at Rs 38.20 per share, up 1.19 percent on Monday from the previous close price.
The company’s P/E ratio is 27.91, which is lower than the industry’s P/E ratio of 40.84, indicating that the stock is trading at a lower price or the stock is undervalued.
Pasupati Acrylon Ltd shares have gained 18 percent in the last six months and 13 percent in a year.
In the recent financial year, the company’s return on equity was reported at 11.37 percent, and its return on capital employed at 15.99 percent. While the company has had a nil debt-to-equity ratio for the last two financial years.
Looking into the margin ratios, the company’s gross profit margin stands at 7.02 percent and operating margin ratio of 6.28 percent.
The company’s revenue has increased by 7 percent year on year, from Rs 775 crore in FY 21-22 to Rs 828 crore in FY 22-23, In the same time period, net profit fell by 22 percent from Rs 46 crore to Rs 36 crore.
Pasupati Acrylon Ltd is engaged in the manufacture of Acrylic Fibre, Tow and Tops, and Cast Polypropylene Films.
The company product is used for carpets, blankets, Toys, towels, bathrobes, bathmats, table linen, furnishings, shirtings, and sarees. The company products include STAPLE Non-Shrinkable Type-R, STAPLE High Shrinkable Type-H.S., TOW Non-Shrinkable Type-R, and TOPS RTU Non-Shrinkable Type N.S.
Sakuma Exports Ltd
Sakuma Exports Ltd is a micro-cap stock with a market capitalization of Rs 520 crores. The company’s shares were trading at Rs 22.25 per share, down 1.11 percent on Monday from the previous close price.
The company’s P/E ratio is 21.63, which is lower than the industry’s P/E ratio of 65.11, indicating that the stock is trading at a lower price or the stock is undervalued. Sakuma Exports shares have gained 60 percent in the last six months and 39 percent in a year.
The company’s revenue has increased by 11 percent year on year, from Rs 2,853 crore in FY 21–22 to Rs 3,173 crore in FY 22-23. During the same period, net profit has slightly gained by 4 percent from Rs 27 crore to Rs 28 crore.
In the recent financial year, the company’s return on equity was reported at 7.17 percent, and its return on capital employed at 10.02 percent. While the company reported a 0.04 debt-to-equity ratio.
In the case of margin ratios, the company’s gross profit margin stands at 1.45 percent and operating margin ratio of 1.41 percent.
Sakuma Exports Ltd is engaged in the business of Buying, Processing, Marketing, and Exporting bulk agricultural commodities like Sugar, Edible Oils, Oil Seeds, Pulses, Cotton, etc.
Written By Omkar Chitnis
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
