The PEG ratio, which stands for Price/Earnings-to-Growth, compares a company’s Price-to-Earnings (P/E) ratio to its expected rate of growth. When the PEG ratio is below 1.0, it suggests that investors may be paying less per unit of earnings growth, making the stock potentially undervalued.
Listed below are the stocks across all the market capitalization having a PEG less than:
Mold-Tek Technologies Ltd
With a market capitalization of Rs. 622 crores, the shares of the company that provides Civil and Mechanical Engineering Services started Friday’s trading session on a lower note at Rs. 211 compared to its previous close of Rs. 217.55. During the trading session, the shares hit a low of Rs. 210.35, losing around 1 percent and closed the day at Rs. 215 apiece.
Looking at the company’s financial statements, the revenue increased by 4 percent from Rs. 40.07 crores during the September quarter to Rs. 41.75 crores in the December quarter. On a contrasting note, the net profits decreased by 14 percent from Rs. 8.13 crores to Rs. 7.01 crores during the same period.
Due to increasing operating revenue and profits on a YoY basis, the profitability metrics of the company improved with the return on equity (RoE) increasing from 19.88 percent during FY 21-22 to 33.20 percent in FY 22-23, and, the return on capital employed (RoCE) zoomed from 25.50 percent to 41.68 percent during the same timeframe.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 19.7 times compared to the industry average of 39.8 times and the PEG ratio stands at 0.49 times, which means the market has underestimated its value with its projected earning potential.
Glenmark Life Sciences Ltd
With a market capitalization of Rs. 9,812 crores, the shares of the pharmaceutical company started Friday’s trading session on a lower note at Rs. 790 compared to its previous close of Rs. 800. During the trading session, the shares hit a high of Rs. 811, gaining around 2 percent and closed the day at Rs. 802 apiece.
Looking at the company’s financial statements, the revenue decreased by 4 percent from Rs. 595 crores during the September quarter to Rs. 573 crores in the December quarter. On the other hand, the net profits remained constant at Rs. 119 crore during both quarters.
Due to increasing expenditure, the profitability metrics of the company declined with the return on equity (RoE) decreasing from 29.83 percent during FY 21-22 to 22.28 percent in FY 22-23, and, the return on capital employed (RoCE) showed a downward movement from 42.20 percent to 29.86 percent during the same timeframe.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 18.8 times compared to the industry average of 33 times and the PEG ratio stands at 0.06 times, which means the market has underestimated its value with its projected earning potential.
Deepak Nitrite Ltd
With a market capitalization of Rs. 30,901 crores, the shares of the chemical company started Friday’s trading session on a lower note at Rs. 2,291 compared to its previous close of Rs. 2,305.25. During the trading session, the shares hit a low of Rs. 2,245.60, losing around 2 percent and closed the day at Rs. 2.271 apiece.
Looking at the company’s recent financial statements, the revenue increased by 13 percent from Rs. 1,778 crores during the September quarter to Rs. 2,009 crores in the December quarter. In addition, the net profits decreased marginally by 1.5 percent from Rs. 205 crores to Rs. 202 crores during the same timeframe.
Due to increasing expenditure, the profitability metrics of the company declined with the return on equity (RoE) decreasing from 23.71 percent during FY 21-22 to 19.23 percent in FY 22-23, and, the return on capital employed (RoCE) showed a downward movement from 30.94 percent to 24.69 percent during the same timeframe.
Furthermore, the stock is deemed overvalued, with a PE ratio of 39.1 times, exceeding the industry average of 33.4 times. Conversely, its PEG ratio stands at 0.67 times, indicating the market may have underestimated its worth relative to its projected earnings potential.
Max Healthcare Institute Ltd
With a market capitalization of Rs. 75,406 crores, the shares of the company providing healthcare services started Friday’s trading session on a flatter note at Rs. 779 compared to its previous close of Rs. 778.10. During the trading session, the shares hit a low of Rs. 748.45, losing around 2 percent and closed the day at Rs. 772 apiece.
Looking at the company’s recent financial statements, the revenue decreased marginally by 2 percent from Rs. 1,363 crores during the September quarter to Rs. 1,335 crores in the December quarter. In addition, the net profits increased by 4 percent from Rs. 277 crores to Rs. 289 crores during the same period.
Due to increasing operating revenue and profits on a YoY basis, the profitability metrics of the company improved with the return on equity (RoE) increasing from 5.41 percent during FY 21-22 to 10.40 percent in FY 22-23, and, the return on capital employed (RoCE) zoomed from 6.89 percent to 8.49 percent during the same timeframe.
Furthermore, the stock is deemed overvalued, with a PE ratio of 71.4 times, exceeding the industry average of 41.3 times. Conversely, its PEG ratio stands at 0.62 times, indicating the market may have underestimated its worth relative to its projected earnings potential.
Written By Vaibhav Patil
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