3 Indian Stocks That May Be Trading At A Discount In September 2024

In the last week, the Indian market is up 1.8%, contributing to a remarkable 41% increase over the past 12 months, with earnings expected to grow by 17% per annum in the coming years. In such a robust environment, identifying stocks that may be trading at a discount can offer significant opportunities for investors looking to capitalize on potential value plays.

Top 10 Undervalued Stocks Based On Cash Flows In India

Name	Current Price	Fair Value (Est)	Discount (Est)
Prataap Snacks (NSEI:DIAMONDYD)	₹819.00	₹1509.79	45.8%
Venus Pipes and Tubes (NSEI:VENUSPIPES)	₹2268.00	₹4394.40	48.4%
Apollo Pipes (BSE:531761)	₹622.70	₹1142.55	45.5%
Titagarh Rail Systems (NSEI:TITAGARH)	₹1302.35	₹2170.73	40%
Patel Engineering (BSE:531120)	₹60.42	₹94.21	35.9%
IRB Infrastructure Developers (NSEI:IRB)	₹60.51	₹93.26	35.1%
Artemis Medicare Services (NSEI:ARTEMISMED)	₹291.55	₹445.15	34.5%
Orchid Pharma (NSEI:ORCHPHARMA)	₹1437.15	₹2142.32	32.9%
Rajesh Exports (NSEI:RAJESHEXPO)	₹293.10	₹584.28	49.8%
Tarsons Products (NSEI:TARSONS)	₹474.90	₹710.88	33.2%

Click here to see the full list of 27 stocks from our Undervalued Indian Stocks Based On Cash Flows screener.

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

Archean Chemical Industries (NSEI:ACI)

Overview: Archean Chemical Industries Limited manufactures and sells specialty marine chemicals in India and internationally, with a market cap of ₹86.44 billion.

Operations: The company's revenue segment includes Marine Chemicals, generating ₹11.99 billion.

Estimated Discount To Fair Value: 11.6%

Archean Chemical Industries, trading at ₹700.5, is 11.6% below its estimated fair value of ₹792.75, indicating potential undervaluation based on cash flows. Despite a recent decline in quarterly revenue and net income compared to the previous year, the company’s earnings are forecast to grow significantly at 33.73% per year, outpacing both industry and market averages. However, regulatory penalties related to GST issues may impact short-term financials but are not substantial enough to overshadow long-term growth prospects.

• Our expertly prepared growth report on Archean Chemical Industries implies its future financial outlook may be stronger than recent results.
• Take a closer look at Archean Chemical Industries' balance sheet health here in our report.

Jindal Steel & Power (NSEI:JINDALSTEL)

Overview: Jindal Steel & Power Limited operates in the steel, mining, and infrastructure sectors both in India and internationally, with a market cap of ₹1.07 trillion.

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

Estimated Discount To Fair Value: 14.2%

Jindal Steel & Power, trading at ₹1052.75, is 14.2% below its estimated fair value of ₹1227.6, suggesting it is undervalued based on cash flows. The company’s earnings are forecast to grow significantly at 24% annually, outpacing the Indian market's 17.1%. Recent strategic alliances for green hydrogen and renewable energy integration underscore a commitment to decarbonisation and may enhance long-term sustainability despite a recent dip in quarterly net income.

• In light of our recent growth report, it seems possible that Jindal Steel & Power's financial performance will exceed current levels.
• Unlock comprehensive insights into our analysis of Jindal Steel & Power stock in this financial health report.

RITES (NSEI:RITES)

Overview: RITES Limited, with a market cap of ₹170.82 billion, offers design, engineering consultancy, and project management services across various sectors including railways, highways, airports, metros, ports, ropeways, urban transport, inland waterways, and renewable energy.

Operations: The company's revenue segments include Export Sale (₹699 million), Power Generation (₹177.80 million), Leasing - Domestic (₹1.41 billion), Consultancy - Abroad (₹766.10 million), Consultancy - Domestic (₹11.79 billion), and Turnkey Construction Projects - Domestic (₹9.10 billion).

Estimated Discount To Fair Value: 31.3%

RITES Limited, trading at ₹710.85, is significantly undervalued with an estimated fair value of ₹1035.17 based on discounted cash flows. The company's earnings are forecast to grow at 23.5% annually, outpacing the Indian market's 17.1%. Recent wins include a ₹600.3 million contract for consultancy services in Uttar Pradesh and a $26.74 million bid for Tanzania Railways Corporation, bolstering future revenue streams despite facing tax-related enforcement actions totaling approximately ₹383 million.

• The analysis detailed in our RITES growth report hints at robust future financial performance.
• Dive into the specifics of RITES here with our thorough financial health report.

Seize The Opportunity

• Explore the 27 names from our Undervalued Indian Stocks Based On Cash Flows screener here.
• Invested in any of these stocks? Simplify your portfolio management with Simply Wall St and stay ahead with our alerts for any critical updates on your stocks.
• Discover a world of investment opportunities with Simply Wall St's free app and access unparalleled stock analysis across all markets.

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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