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The Indian market has experienced a flat performance over the last week, yet it has seen a remarkable 40% increase over the past year with earnings projected to grow by 17% annually. In such conditions, identifying stocks that may be trading below their estimated value can offer investors potential opportunities for growth and diversification.
Top 10 Undervalued Stocks Based On Cash Flows In India
Name | Current Price | Fair Value (Est) | Discount (Est) |
Titagarh Rail Systems (NSEI:TITAGARH) | ₹1197.50 | ₹2143.10 | 44.1% |
RITES (NSEI:RITES) | ₹302.90 | ₹517.46 | 41.5% |
IOL Chemicals and Pharmaceuticals (BSE:524164) | ₹420.20 | ₹762.32 | 44.9% |
Vedanta (NSEI:VEDL) | ₹480.85 | ₹903.15 | 46.8% |
Patel Engineering (BSE:531120) | ₹55.27 | ₹91.80 | 39.8% |
IRB Infrastructure Developers (NSEI:IRB) | ₹57.27 | ₹91.13 | 37.2% |
Artemis Medicare Services (NSEI:ARTEMISMED) | ₹274.05 | ₹445.15 | 38.4% |
Tarsons Products (NSEI:TARSONS) | ₹412.65 | ₹706.66 | 41.6% |
Manorama Industries (BSE:541974) | ₹932.30 | ₹1665.51 | 44% |
Strides Pharma Science (NSEI:STAR) | ₹1628.90 | ₹2704.30 | 39.8% |
Let's review some notable picks from our screened stocks.
IRB Infrastructure Developers
Overview: IRB Infrastructure Developers Limited operates in the infrastructure development sector in India, with a market capitalization of ₹345.85 billion.
Operations: The company's revenue is primarily derived from its Construction segment, which accounts for ₹51.92 billion, and BOT/TOT Projects, contributing ₹24.16 billion.
Estimated Discount To Fair Value: 37.2%
IRB Infrastructure Developers appears undervalued, trading at ₹57.27 below its estimated fair value of ₹91.13, with analysts forecasting a 26% price increase. Despite an unstable dividend history and insufficient earnings to cover interest payments, the company shows promising growth potential with earnings expected to rise significantly at 32.1% annually, outpacing the Indian market's 17.4%. Recent debt financing efforts may support future capital expenditures and acquisitions, enhancing cash flow prospects.
Jindal Stainless
Overview: Jindal Stainless Limited manufactures and sells stainless-steel flat products in India and internationally, with a market cap of ₹611.77 billion.
Operations: The company's revenue is primarily derived from its stainless steel products segment, amounting to ₹377.88 billion.