Exploring Undiscovered Gems In Indian Stocks July 2024

The Indian stock market has experienced a notable fluctuation recently, declining by 2.0% over the last week, yet showing an impressive annual increase of 43%. In this context, identifying stocks with potential for robust earnings growth, forecasted at 16% annually, becomes particularly compelling for investors looking to uncover less recognized opportunities in such a dynamic market.

Top 10 Undiscovered Gems With Strong Fundamentals In India

Name	Debt To Equity	Revenue Growth	Earnings Growth	Health Rating
Voith Paper Fabrics India	NA	10.79%	9.57%	★★★★★★
NGL Fine-Chem	12.35%	15.70%	9.76%	★★★★★★
Timex Group India	2.24%	16.39%	61.31%	★★★★★★
Bengal & Assam	4.48%	3.82%	47.41%	★★★★★☆
Indo Tech Transformers	2.30%	20.60%	62.92%	★★★★★☆
Avantel	10.67%	34.84%	36.61%	★★★★★☆
Spright Agro	0.58%	83.13%	86.22%	★★★★★☆
KP Green Engineering	13.73%	47.60%	61.28%	★★★★★☆
Apollo Micro Systems	38.17%	7.94%	2.46%	★★★★☆☆
SG Mart	16.73%	99.32%	94.08%	★★★★☆☆

Click here to see the full list of 454 stocks from our Indian Undiscovered Gems With Strong Fundamentals screener.

We're going to check out a few of the best picks from our screener tool.

Ethos (NSEI:ETHOSLTD)

Simply Wall St Value Rating: ★★★★★★

Overview: Ethos Limited is a company that operates a chain of luxury watch boutiques across India, with a market capitalization of ₹79.97 billion.

Operations: Ethos generates its revenue primarily through the trading of watches, accessories, and other luxury items. The company's gross profit margin as of the latest reported period stands at 30.09%, reflecting its cost management in relation to sales revenue.

Ethos, a lesser-known gem in India's retail sector, has showcased remarkable financial and operational growth. Over the past year, its earnings surged by 38.1%, outpacing the industry average of 28.7%. The company's debt-to-equity ratio dramatically improved from 59.1% to just 0.8% over five years, reflecting robust financial health and strategic debt management. Recently, Ethos reported a significant increase in annual revenue to INR 10,226 million and net income to INR 833 million for FY2024, underscoring its potential amidst competitive markets.

• Get an in-depth perspective on Ethos' performance by reading our health report here.

• Assess Ethos' past performance with our detailed historical performance reports.

Orchid Pharma (NSEI:ORCHPHARMA)

Simply Wall St Value Rating: ★★★★★★

Overview: Orchid Pharma Limited is a pharmaceutical company based in India that specializes in the development, manufacture, and marketing of active pharmaceutical ingredients, bulk actives, finished dosage formulations, and nutraceuticals, with a market capitalization of ₹69.48 billion.

Operations: The company generates its revenue primarily through the pharmaceutical sector, with a recent reported revenue of ₹8.19 billion. It incurs substantial costs in goods sold and operational expenses, influencing its financial performance over various periods.

Orchid Pharma, a notable player in India's pharmaceutical landscape, has recently launched Cefepime-Enmetazobactam, addressing critical infections like cUTI and HAP. This innovation follows their approval for a new API and FDF by the DCGI. Financially robust, Orchid reported a substantial revenue increase to INR 8.5 billion this year from INR 6.9 billion last year, with net income doubling to INR 921 million. Their strategic partnership with Cipla aims to enhance distribution across India, leveraging Orchid’s R&D strengths with Cipla’s market reach.

• Navigate through the intricacies of Orchid Pharma with our comprehensive health report here.

• Evaluate Orchid Pharma's historical performance by accessing our past performance report.

Power Mech Projects (NSEI:POWERMECH)

Simply Wall St Value Rating: ★★★★★★

Overview: Power Mech Projects Limited operates in the power and infrastructure sectors both within India and internationally, with a market capitalization of ₹102.06 billion.

Operations: The company generates revenue primarily from construction and maintenance activities, with a notable increase in gross profit margin to 28.35% by the end of the latest reported period. It has managed to grow its net income significantly over the years, reaching ₹2.48 billion in the most recent fiscal quarter.

Power Mech Projects, a lesser-known yet robust contender in India's construction sector, has shown promising financial and operational performance. With a recent significant order from Hindustan Zinc worth INR 2,095 million and another from BHEL for INR 5.63 billion, the company is poised for growth. Financially, Power Mech boasts a strong coverage with EBIT covering interest payments by 4.8 times and maintains more cash than debt. Its earnings have grown by an impressive 24.8% annually over the past five years, outpacing many peers but still trailing the industry growth rate of 36.5%. Looking ahead, earnings are expected to surge by approximately 49% annually.

• Unlock comprehensive insights into our analysis of Power Mech Projects stock in this health report.

• Review our historical performance report to gain insights into Power Mech Projects''s past performance.

Turning Ideas Into Actions

• Unlock more gems! Our Indian Undiscovered Gems With Strong Fundamentals screener has unearthed 451 more companies for you to explore.Click here to unveil our expertly curated list of 454 Indian Undiscovered Gems With Strong Fundamentals.
• Are these companies part of your investment strategy? Use Simply Wall St to consolidate your holdings into a portfolio and gain insights with our comprehensive analysis tools.
• Enhance your investing ability with the Simply Wall St app and enjoy free access to essential market intelligence spanning every continent.

Contemplating Other Strategies?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

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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