5 Debt-Free Companies Having PE Ratio Below 10

Among several factors, debt-free company and a low price-to-earnings (P/E) ratio are the two important aspects to be taken into consideration while buying the stock of a company. Using a screener, we have identified 5 debt-free companies that have a P/E ratio below 10.

These companies are Seshasayee Paper & Boards Ltd, Brightcom Group Ltd, General Insurance Corporation of India, BF Investment Ltd and Alembic Ltd. Except for General Insurance, the remaining 4 companies are small cap companies.

What Is P/E Ratio?

Price-to-earnings ratio is an equity ratio among several parameters that help determine the stock value. It indicates how a stock value has faired against the major indices like BSE and NSE. It shows the relativity of the market value of a stock concerning the company's earnings if it is expensive or cheap.

A high P/E ratio indicates that a stock's price is high in relation to its earnings and is overvalued. Likewise, a low P/E ratio indicate that the current stock price is low relative to earnings.

Additionally, a high P/E ratio of a company may mean that it is expected that revenue would grow faster in the future. Based on it speculation is done, leading to a spurt in its current stock prices.

The details of the companies are given below:

1. Seshasayee Paper & Boards Ltd

Seshasayee Paper and Boards (SPB) is engaged in the business of manufacture and sale of printing and writing paper. It was incorporated in June 1960 as a flagship company belonging to SPB-Esvin Group. Its headquarters is located at Pallipalayam in Erode of Namakkal district and has its paper mill in Tirunelveli district of Tamil Nnadu.

The current market capitalisation of the company stands at Rs 1,731.22 crore and has a low P/E of 4.35. The share price of the company has rallied by 40.09% in the last one year while in three years, it has massively surged by nearly 123.08%.

2. Brightcom Group Ltd

Brightcom Group is a small cap company with a market capitalisation of Rs 3,174.19 crore incorporated in 2010. It offers digital marketing solutions to businesses, agencies and online publishers worldwide. This small cap company stock has the lowest P/E of 2.32 in this entire list.

The share price of the company stock has plunged sharply by 73.32% in the last one year but over the last years, it has surged by whopping 438.7%. Currently, the stock of the firm has been put under additional surveillance measures by the stock market regulator SEBI.

3. General Insurance Corporation of India

General Insurance Corporation of India (GIC) is a large cap company incorporated in 1972. It operates in the financial services sector. This debt-free company has a market capitalisation of Rs 30,175.68 crore and a P/E of 5.51.

In the last one year and over three years, the share price of GIC has rallied by 51.94% and 37.66% respectively.

4. BF Investment Ltd

BF Investment is a small cap company formed by demerging the investment business of BF Utilities Ltd by way of a Composite Scheme of Arrangement in 2009. BF Investment is an investment company that primarily invests in strategic investments in Kalyani Group companies.

This debt-free company has a market capitalisation of Rs 1,408.77 crore and a P/E of 6.08. The price of the company's share has increased by 40.52% in the last one year and 60.69% in the last three years.

5. Alembic Limited

Alembic Ltd is an integrated pharmaceutical company. The company's products include active pharmaceutical ingredients (API), bulk pharmaceuticals, international and domestic formulations, herbals and nutraceuticals and also veterinary. It is also involved in three main areas of research, namely chemistry and synthesis, formulation development and contract research.

The company has a market capitalisation of Rs 1,726.09 crore and a P/E of 8.66. In the last one year, its share price has fallen by 3.97% but over three years, it has rallied by 28.65%.

Disclaimer

This write-up is for information purposes only and is not a recommendation to buy, sell or hold a stock. Greynium Information Technologies or the author is not liable for any losses caused as a result of decisions taken on the basis of this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.