Valuation Metrics and Recent Changes
As of 16 Feb 2026, Ausom Enterprise Ltd trades at ₹108.05, down 1.64% from the previous close of ₹109.85. The stock’s 52-week range spans from ₹72.78 to ₹178.00, indicating significant volatility over the past year. The company’s price-to-earnings (P/E) ratio currently stands at a low 4.96, a figure that remains well below the industry average and signals a potentially undervalued status. The price-to-book value (P/BV) ratio is 0.93, suggesting the stock is trading just below its book value, which often appeals to value investors seeking margin of safety.
Other valuation multiples reinforce this narrative: the enterprise value to EBIT (EV/EBIT) ratio is 8.33, and the EV to EBITDA ratio is 8.23, both comfortably below typical sector averages. The EV to capital employed ratio is also low at 0.93, while the EV to sales ratio is an exceptionally modest 0.07. These metrics collectively underpin the recent downgrade in valuation grade from very attractive to attractive, reflecting a slight re-rating but still indicating a favourable valuation stance.
Comparative Peer Analysis
When benchmarked against peers within the Gems, Jewellery and Watches industry, Ausom Enterprise Ltd’s valuation multiples stand out for their relative conservatism. For instance, Indiabulls trades at a P/E of 80.34 and an EV/EBITDA of 21.14, categorised as very expensive. Similarly, Cropster Agro and RRP Defense exhibit P/E ratios above 400, signalling elevated risk or overvaluation. By contrast, Ausom’s P/E of 4.96 and EV/EBITDA of 8.23 place it in the attractive valuation category, underscoring its potential as a value proposition within the sector.
Other peers such as India Motor Part and Aeroflex Enterprise also present interesting comparisons. India Motor Part is rated very attractive with a P/E of 16.55, while Aeroflex Enterprise holds a P/E of 17.34 and an EV/EBITDA of 7.05. Ausom’s lower multiples suggest it remains competitively priced, though the recent downgrade in valuation grade indicates the market is beginning to price in some risks or uncertainties.
Financial Performance and Quality Metrics
Beyond valuation, Ausom Enterprise Ltd’s operational metrics provide additional context. The company’s return on capital employed (ROCE) is 10.42%, while return on equity (ROE) stands at a robust 17.56%. These figures indicate efficient capital utilisation and healthy profitability, which support the stock’s investment case despite the recent valuation adjustment. The dividend yield of 0.93% is modest but consistent, adding a small income component to the total return potential.
Moreover, the company’s PEG ratio is an exceptionally low 0.03, suggesting that earnings growth expectations are not fully reflected in the current price, which could imply upside potential if growth materialises as anticipated.
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Stock Performance Relative to Sensex
Ausom Enterprise Ltd’s stock performance over various time horizons reveals a mixed but generally positive trend relative to the benchmark Sensex index. Over the past week, the stock gained 0.28%, outperforming the Sensex’s decline of 1.14%. However, over the last month, Ausom’s share price fell sharply by 23.94%, significantly underperforming the Sensex’s modest 1.20% decline. Year-to-date, the stock is down 1.77%, slightly better than the Sensex’s 3.04% fall.
Longer-term returns paint a more favourable picture. Over one year, Ausom delivered a 9.36% return, marginally ahead of the Sensex’s 8.52%. Over three years, the stock’s cumulative return of 68.04% more than doubles the Sensex’s 36.73%. Impressively, over five and ten years, Ausom has generated returns of 120.29% and 438.90% respectively, substantially outperforming the Sensex’s 60.30% and 259.46% gains. This long-term outperformance underscores the company’s resilience and growth potential despite short-term valuation adjustments.
Market Capitalisation and Mojo Score Update
Ausom Enterprise Ltd holds a market capitalisation grade of 4, reflecting its mid-cap status within the Gems, Jewellery and Watches sector. The company’s overall Mojo Score currently stands at 64.0, with a Mojo Grade downgraded from Buy to Hold as of 1 Feb 2026. This downgrade reflects the recent valuation grade shift from very attractive to attractive and signals a more cautious stance by analysts, balancing the company’s strong fundamentals against emerging market uncertainties and valuation pressures.
Investment Implications and Outlook
The adjustment in Ausom Enterprise Ltd’s valuation grade from very attractive to attractive suggests that while the stock remains a compelling value opportunity, investors should be mindful of evolving market dynamics and sector-specific risks. The company’s low P/E and P/BV ratios relative to peers, combined with solid profitability metrics and long-term outperformance, continue to support its investment case. However, the recent price correction and downgrade in Mojo Grade indicate that near-term volatility and valuation re-rating may persist.
Investors considering Ausom Enterprise Ltd should weigh its attractive valuation against the broader market context and sector outlook. The Gems, Jewellery and Watches industry faces challenges including fluctuating commodity prices, consumer demand variability, and regulatory changes, all of which could impact earnings visibility. Nonetheless, Ausom’s strong capital efficiency and competitive pricing relative to peers may provide a cushion against downside risks.
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Conclusion
Ausom Enterprise Ltd’s recent valuation grade shift from very attractive to attractive reflects a nuanced change in market perception rather than a fundamental deterioration. The company’s low P/E of 4.96 and P/BV of 0.93 remain highly competitive within the Gems, Jewellery and Watches sector, supported by solid ROE and ROCE figures. While the downgrade to a Hold rating signals caution, the stock’s long-term performance and relative valuation strength continue to make it a noteworthy contender for value-focused investors.
Market participants should monitor upcoming earnings releases and sector developments closely, as these will be critical in determining whether Ausom can regain its previous valuation premium or if further adjustments are warranted. For now, the stock offers a balanced risk-reward profile, with valuation metrics suggesting it remains attractively priced despite recent market headwinds.
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