3 Indian Stocks Estimated To Be Undervalued In August 2024

Over the last 7 days, the Indian market has dropped 1.7%, but it has risen by 43% over the past year. With earnings expected to grow by 17% per annum in the coming years, identifying undervalued stocks can present significant opportunities for investors looking to capitalize on potential market gains.

Top 10 Undervalued Stocks Based On Cash Flows In India

Name	Current Price	Fair Value (Est)	Discount (Est)
NIIT Learning Systems (NSEI:NIITMTS)	₹466.10	₹712.01	34.5%
HEG (NSEI:HEG)	₹2100.65	₹3915.05	46.3%
S Chand (NSEI:SCHAND)	₹225.92	₹352.58	35.9%
Krsnaa Diagnostics (NSEI:KRSNAA)	₹688.65	₹1165.33	40.9%
RITES (NSEI:RITES)	₹675.70	₹1047.37	35.5%
Prataap Snacks (NSEI:DIAMONDYD)	₹820.45	₹1509.79	45.7%
Texmaco Rail & Engineering (NSEI:TEXRAIL)	₹254.85	₹395.97	35.6%
Rajesh Exports (NSEI:RAJESHEXPO)	₹295.45	₹590.75	50%
Piramal Pharma (NSEI:PPLPHARMA)	₹185.84	₹289.56	35.8%
Strides Pharma Science (NSEI:STAR)	₹1127.80	₹2032.10	44.5%

Click here to see the full list of 29 stocks from our Undervalued Indian Stocks Based On Cash Flows screener.

Let's explore several standout options from the results in the screener.

IRB Infrastructure Developers (NSEI:IRB)

Overview: IRB Infrastructure Developers Limited operates in the infrastructure development sector in India with a market cap of ₹376.59 billion.

Operations: The company's revenue segments include toll collection, construction contracts, and airport development.

Estimated Discount To Fair Value: 11%

IRB Infrastructure Developers is trading 11% below its estimated fair value of ₹70.04, indicating potential undervaluation based on cash flows. Despite a low forecasted Return on Equity (8.3%) in three years and an unstable dividend track record, earnings are expected to grow significantly at 31.07% annually, outpacing the Indian market's growth rate of 16.9%. Recent Q1 results show increased revenue and net income compared to the previous year, supporting positive cash flow trends.

• The growth report we've compiled suggests that IRB Infrastructure Developers' future prospects could be on the up.
• Delve into the full analysis health report here for a deeper understanding of IRB Infrastructure Developers.

Jindal Steel & Power (NSEI:JINDALSTEL)

Overview: Jindal Steel & Power Limited operates in the steel, mining, and infrastructure sectors in India and internationally with a market cap of ₹936.54 billion.

Operations: The company's revenue primarily comes from manufacturing steel products, amounting to ₹510.56 billion.

Estimated Discount To Fair Value: 23.9%

Jindal Steel & Power is trading 23.9% below its estimated fair value of ₹1,207.18, suggesting it may be undervalued based on cash flows. Despite a recent dip in net income to ₹13,401.5 million for Q1 2024 from ₹16,869.4 million last year, earnings are projected to grow at 24.06% annually over the next three years, outpacing the Indian market's growth rate of 16.9%. Recent M&A activity and solid production figures further highlight its potential for future cash flow improvements.

• Upon reviewing our latest growth report, Jindal Steel & Power's projected financial performance appears quite optimistic.
• Navigate through the intricacies of Jindal Steel & Power with our comprehensive financial health report here.

Rajesh Exports (NSEI:RAJESHEXPO)

Overview: Rajesh Exports Limited, with a market cap of ₹87.23 billion, is a gold refiner that manufactures, wholesales, and retails gold and diamond jewelry and various gold products in India.

Operations: Rajesh Exports generates revenue primarily from gold products, amounting to ₹2.81 billion.

Estimated Discount To Fair Value: 50%

Rajesh Exports (₹295.45) is trading at approximately 50% below its estimated fair value of ₹590.75, indicating significant undervaluation based on discounted cash flow analysis. Despite a slight decline in profit margins from 0.4% to 0.1%, earnings are forecast to grow at a robust 31.68% annually, surpassing the Indian market's average growth rate of 16.9%. Revenue is expected to increase by 14.1% per year, outpacing the market's projected growth of 9.9%.

• Our expertly prepared growth report on Rajesh Exports implies its future financial outlook may be stronger than recent results.
• Unlock comprehensive insights into our analysis of Rajesh Exports stock in this financial health report.

Summing It All Up

• Unlock our comprehensive list of 29 Undervalued Indian Stocks Based On Cash Flows by clicking here.
• Got skin in the game with these stocks? Elevate how you manage them by using Simply Wall St's portfolio, where intuitive tools await to help optimize your investment outcomes.
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Interested In Other Possibilities?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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