Synopsis:
Esab India, Action Construction Equipment, and three other companies have a proven track record of strong returns, solid business models, and solid MOAT in their sectors. With current P/E ratios below their 5-year median levels, they may offer value for patient investors.
Some fundamentally strong companies with solid financials and proven track records are now trading below their historical valuation multiples. This means investors can access quality businesses at prices lower than what the market has typically paid in the past. Such situations are rare, as strong fundamentals usually command a premium.
Esab India
ESAB produces equipment that is necessary for metal cutting and joining. The machines are employed in industrial facilities that produce steel-based structures. ESAB, as a company, engineers its offerings in accordance with the requirements of the laborers, thus the appliances have high speed and low failure rates.
With a market capitalisation of Rs 8,705 crore, the stock is currently trading at an attractive P/E multiple of 47.8x, below its 5-Year Median P/E of 51x. It has delivered a robust ROE and ROCE of 52.34 percent and 70.03 percent respectively.
Accelya Solutions India
Accelya Solutions Ltd works worldwide, creating tech for airlines, freight carriers, besides travel firms. Its platforms assist air carriers with invoicing, payouts, agent fees, along pricing math. The firm delivers freight handling tools – handling reservations, storage, plus income tracking. Basically, it keeps airline finances, daily operations, and shipping tasks moving without hiccups.
With a market capitalisation of Rs 1,975 crore, the stock is currently trading at an attractive P/E multiple of 15.6x, much below its 5-Year Median P/E of 21.3x. It has also delivered a robust ROE and ROCE of 45.47 percent and 53.61 percent respectively.
Jyoti Resins and Adhesives
Jyoti Resins and Adhesives Ltd was founded in 1993 and is based in Ahmedabad. The company makes synthetic resins and wood adhesives under the EURO brand. Its products, including waterproof and multipurpose adhesives, are popular in the fast-moving consumer goods market throughout India.
With a market capitalisation of Rs 1,424 crore, the stock is currently trading at an attractive P/E multiple of 19.5x, much below its 5-Year Median P/E of 25.7x. It has delivered an exceptional ROE and ROCE of 37.35 percent and 49.98 percent respectively.
Triveni Turbine
Triveni Turbine Limited is a premier industrial steam turbine manufacturer in India that supplies to domestic and overseas markets. It has back-pressure and condensing steam turbines, API-compliant units, and pressure-reducing turbines in modular form. The company also offers turbine services in maintenance, upgrade, refurbishment, and remote monitoring. Triveni turbines find application in the sugar, cement, steel, chemical, refinery, and power industries, and also in cogeneration and geothermal applications.
With a market capitalisation of Rs 17,099 crore, the stock is currently trading at an attractive P/E multiple of 50.1x, just below its 5-Year Median P/E of 54.8x. It has delivered a robust ROE and ROCE of 30.59 percent and 41.36 percent respectively.
Action Construction Equipment
ACE (Action Construction Equipment Ltd) is the leading crane and heavy equipment manufacturer in India. Established in 1995, the company produces a variety of products ranging from mobile cranes and tower cranes to loaders, forklifts, tractors, and a wide range of equipment used in huge infrastructure and industrial projects. With up-to-date manufacturing units and a well-established after-sales service network, ACE is at the core of India’s construction and material-handling demands.
With a market capitalisation of Rs 11,491 crore, the stock is currently trading at an attractive P/E multiple of 27.4x, much below its 5-Year Median P/E of 33x. It has delivered a robust ROE and ROCE of 28.65 percent and 40.11 percent respectively.
Written by Satyajeet Mukherjee
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