Vallabh Steels and K G Denim are companies that are currently trading below what they’re actually worth. Investors can profit from the difference by investing in these stocks as the current market prices should eventually move towards their true values. If capital gains are what you’re after in your next investment, I’ve put together a list of undervalued stocks you may be interested in, based on the latest financial data from each company.
Vallabh Steels Limited (BSE:513397)
Vallabh Steels Limited manufactures and markets steel pipes, and cold rolled steel strips and coils primarily in India. Founded in 1980, and currently run by Kapil Jain, the company currently employs 143 people and with the company’s market cap sitting at INR ₹143.30M, it falls under the small-cap group.
513397’s shares are now trading at -74% under its value of INR112.07, at a price tag of ₹28.95, according to my discounted cash flow model. The mismatch signals a potential chance to invest in 513397 at a discounted price. What’s even more appeal is that 513397’s PE ratio is trading at around 16.73x while its Metals and Mining peer level trades at, 19.25x suggesting that relative to its peers, we can buy 513397’s stock at a cheaper price today. 513397 is also a financially robust company, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. It’s debt-to-equity ratio of 80.09% has been reducing for the past few years showing 513397’s capability to reduce its debt obligations year on year. Interested in Vallabh Steels? Find out more here.
K G Denim Limited (BSE:500239)
K G Denim Limited manufactures and sells denim and apparel fabrics to fashion brands and retailers worldwide. K G Denim was established in 1992 and with the stock’s market cap sitting at INR ₹1.24B, it comes under the small-cap group.
500239’s stock is currently trading at -63% lower than its actual level of INR129.12, at a price tag of ₹48.30, according to my discounted cash flow model. This discrepancy gives us a chance to invest in 500239 at a discount. Moreover, 500239’s PE ratio stands at 5.45x against its its Luxury peer level of, 18.32x suggesting that relative to its competitors, 500239 can be bought at a cheaper price right now. 500239 is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities. Finally, its debt relative to equity is 128.01%, which has been diminishing for the past few years showing 500239’s ability to reduce its debt obligations year on year. Dig deeper into K G Denim here.