Undervalued Stocks with Low P/E and PEG: Stocks with low P/E (Price-to-Earnings) and PEG (Price/Earnings-to-Growth) ratios below 1 offer a fantastic opportunity for investors. These stocks are often undervalued and show strong growth potential.
What is PE ratio and PEG
The price-to-earnings ratio, also known as P/E ratio, is the ratio of a company’s share price to the company’s earnings per share. The ratio is used for valuing companies and to find out whether they are overvalued or undervalued.
P/E Ratio = Earnings per share / Market value per share
The ‘PEG ratio‘ (price/earnings to growth ratio) is a valuation metric for determining the relative trade-off between the price of a stock, the earnings generated per share (EPS), and the company’s expected growth.
PEG = PE / Annual Earning per Share(EPS) Growth
5 Undervalued Stocks with Low P/E and PEG
Here are 5 key companies with P/E below the industry average and PEG below 1:
Coal India: Stability and Profitability
Coal India is a leader in coal mining and production in India, serving the power and steel sectors. Its low P/E and PEG make it a great long-term investment option.
- Market Capitalization: ₹2,37,142 crore
- Share Price: ₹384.80 (0.47% increase)
- P/E Ratio: 6.53 (Industry P/E: 19.4)
- PEG Ratio: 0.40
Dr. Reddy’s Laboratories: Global Leader in Pharmaceuticals
Dr. Reddy’s Laboratories is a leader in active pharmaceutical ingredients, generic drugs, and biosimilars. Its undervalued PEG makes it an attractive investment in the pharma sector.
- Market Capitalization: ₹1,12,724 crore
- Share Price: ₹1,351 (0.76% increase)
- P/E Ratio: 21.1 (Industry P/E: 32.9)
- PEG Ratio: 0.87
Also Read : Highest Dividend Paying Midcap Stocks: Secure Income and Growth in 2025
Indus Towers : Wireless Communication
Indus Towers is a leading company in the installation, operation, and maintenance of wireless communication towers. Its strong fundamentals and stable PEG make it a safe option for investors.
- Market Capitalization: ₹88,378 crore
- Share Price: ₹335 (0.07% increase)
- P/E Ratio: 11.9 (Industry P/E: 31.9)
- PEG Ratio: 0.57
Jai Balaji Industries: Leader in Steel Manufacturing
Jai Balaji Industries plays a crucial role in manufacturing iron and steel products, including sponge iron and ductile iron pipes. Its stable growth and undervalued PEG make it suitable for investment in the metal sector.
- Market Capitalization: ₹16,436 crore
- Share Price: ₹900.85 (0.16% increase)
- P/E Ratio: 18.8 (Industry P/E: 19.2)
- PEG Ratio: 0.37
Nava: Multi-Sector
Nava Limited is involved in diverse businesses like power generation, ferroalloys manufacturing, and mining. Its multi-sector presence and strong PEG make it an appealing option for investors.
- Market Capitalization: ₹15,483 crore
- Share Price: ₹990 (0.87% increase)
- P/E Ratio: 13.5 (Industry P/E: 20.6)
- PEG Ratio: 0.43
Also Read:
5 Stocks with Order Books Larger Than Market Cap
5 Multibagger Stocks to Watch in 2025
Conclusion: Look for Opportunities
These stocks with low P/E and PEG ratios offer investors the chance to invest in undervalued shares. These companies are not only leaders in their industries but also have strong fundamentals, providing long-term benefits. Always do proper research and seek expert advice before investing.