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Dalmia Bharat Sugar and Industries Limited (NSE:DALMIASUG) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of DALMIASUG, it is a financially-robust company with a an impressive track record of performance, trading at a great value. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Dalmia Bharat Sugar and Industries here.
Undervalued with excellent balance sheet
In the previous year, DALMIASUG has ramped up its bottom line by 43%, with its latest earnings level surpassing its average level over the last five years. In addition to beating its historical values, DALMIASUG also outperformed its industry, which delivered a growth of 15%. This is what investors like to see! DALMIASUG's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that DALMIASUG has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. DALMIASUG seems to have put its debt to good use, generating operating cash levels of 0.72x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.
DALMIASUG's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts' consensus forecast growth be correct. Compared to the rest of the food industry, DALMIASUG is also trading below its peers, relative to earnings generated. This bolsters the proposition that DALMIASUG's price is currently discounted.
Next Steps:
For Dalmia Bharat Sugar and Industries, I've put together three relevant aspects you should look at:
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Future Outlook: What are well-informed industry analysts predicting for DALMIASUG’s future growth? Take a look at our free research report of analyst consensus for DALMIASUG’s outlook.
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Dividend Income vs Capital Gains: Does DALMIASUG return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from DALMIASUG as an investment.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of DALMIASUG? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.