July 2024 Insight Into Indian Exchange Stocks Estimated Below Value

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The Indian stock market has shown robust growth, rising by 44% over the past 12 months and gaining 1.1% in just the last week, with earnings expected to grow by 16% annually. In such a thriving market, identifying stocks that are potentially undervalued could offer investors a unique opportunity for value investment.

Top 10 Undervalued Stocks Based On Cash Flows In India

Name

Current Price

Fair Value (Est)

Discount (Est)

Updater Services (NSEI:UDS)

₹297.25

₹477.81

37.8%

IOL Chemicals and Pharmaceuticals (BSE:524164)

₹403.65

₹574.52

29.7%

Vedanta (NSEI:VEDL)

₹454.00

₹635.30

28.5%

Strides Pharma Science (NSEI:STAR)

₹948.85

₹1520.38

37.6%

Mahindra Logistics (NSEI:MAHLOG)

₹525.05

₹800.49

34.4%

TV18 Broadcast (NSEI:TV18BRDCST)

₹41.18

₹69.41

40.7%

PVR INOX (NSEI:PVRINOX)

₹1427.35

₹2229.08

36%

Delhivery (NSEI:DELHIVERY)

₹400.15

₹604.58

33.8%

Camlin Fine Sciences (BSE:532834)

₹103.22

₹155.05

33.4%

Godrej Properties (NSEI:GODREJPROP)

₹3207.90

₹4589.46

30.1%

Click here to see the full list of 16 stocks from our Undervalued Indian Stocks Based On Cash Flows screener.

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

Fusion Micro Finance

Overview: Fusion Micro Finance Limited is a non-banking financial company in India that offers microfinance lending services to women entrepreneurs in rural and peri-rural areas, with a market capitalization of approximately ₹45.15 billion.

Operations: The company generates revenue primarily through microfinance activities, totaling approximately ₹12.57 billion.

Estimated Discount To Fair Value: 10.4%

Fusion Micro Finance, now Fusion Finance Limited, is trading at ₹448.75, below its estimated fair value of ₹500.61, indicating a 10.4% undervaluation based on discounted cash flow analysis. Despite robust revenue growth projections at 24.9% annually—outpacing the Indian market's 9.6%—its debt is poorly covered by operating cash flow, and return on equity is expected to be modest at 19.3%. Recent regulatory challenges and significant insider selling could pose risks, though the company has shown strong earnings growth in the past five years.

NSEI:FUSION Discounted Cash Flow as at Jul 2024
NSEI:FUSION Discounted Cash Flow as at Jul 2024

Godrej Properties

Overview: Godrej Properties Limited operates primarily in real estate construction and development across India, with a market capitalization of approximately ₹891.98 billion.

Operations: The company's revenue is mainly derived from real estate construction and development, totaling approximately ₹29.95 billion, with a smaller contribution of ₹0.41 billion from the hospitality sector.