Forbes & Company Ltd Valuation Shifts to Fair Amid Market Pressure

Valuation Metrics Reflect a More Balanced Price Point

At the heart of Forbes & Company’s valuation reassessment lies its price-to-earnings (P/E) ratio, which currently stands at a modest 6.80. This figure is significantly lower than many of its industry peers, such as Salasar Techno, which trades at a P/E of 45.6, and JNK at 29.95. The company’s price-to-book value (P/BV) ratio is 1.86, indicating a valuation close to its book value, which suggests the market is pricing the stock more conservatively than before.

These valuation multiples have shifted the company’s grade from expensive to fair, signalling a more reasonable entry point for investors who may have previously viewed the stock as overvalued. The enterprise value to EBITDA (EV/EBITDA) ratio of 17.01, while higher than some peers like Bharat Wire (9.59), remains within a range that does not excessively penalise the stock on operational earnings grounds.

Comparative Peer Analysis Highlights Relative Value

When compared to its peer group within the Electronics & Appliances sector, Forbes & Company’s valuation metrics present a mixed picture. While some competitors such as Salasar Techno and Bharat Wire are classified as attractive based on their valuation and growth prospects, others like Mamata Machinery and Gala Precision Engineering remain expensive. The company’s PEG ratio of 0.05 is particularly noteworthy, indicating that its price is low relative to its earnings growth potential, a factor that could appeal to value-oriented investors.

However, the company’s Mojo Score of 26.0 and a recent downgrade from Sell to Strong Sell on 15 September 2025 reflect concerns about its overall quality and market sentiment. This downgrade is likely influenced by operational challenges or broader sector headwinds, despite the more favourable valuation.

Financial Performance and Returns: A Mixed Outlook

Forbes & Company’s return profile over various time horizons offers a nuanced perspective. The stock has delivered an impressive 776.88% return over five years and an extraordinary 860.54% over ten years, far outpacing the Sensex’s 67.42% and 255.80% returns respectively. This long-term outperformance underscores the company’s historical value creation for shareholders.

However, recent performance has been less encouraging. Year-to-date, the stock has gained 2.27%, slightly outperforming the Sensex’s negative 2.26%. Yet, over the past month and week, the stock has declined sharply by 23.67% and 10.03% respectively, while the Sensex has posted modest gains. This short-term weakness is reflected in the stock’s day change of -5.96% on 24 February 2026, signalling increased volatility and investor caution.

Operational Efficiency and Profitability Metrics

Examining profitability, Forbes & Company reports a return on capital employed (ROCE) of 11.95% and a robust return on equity (ROE) of 29.61%. These figures indicate efficient utilisation of capital and strong profitability relative to equity, which are positive indicators for long-term investors. Nevertheless, the elevated enterprise value to EBIT ratio of 18.83 suggests that operational earnings are priced with some premium, possibly reflecting expectations of future growth or sector positioning.

Market Capitalisation and Risk Considerations

The company holds a market capitalisation grade of 4, indicating a mid-tier market cap status within its sector. This positioning can influence liquidity and investor interest, especially in comparison to larger peers. The downgrade to a Strong Sell Mojo Grade, despite the fair valuation, highlights underlying risks that may include sector cyclicality, competitive pressures, or company-specific challenges.

Price Movements and Trading Range

On 24 February 2026, Forbes & Company’s stock traded between ₹331.10 and ₹359.80, closing near the day’s low at ₹331.10, down from the previous close of ₹352.10. The 52-week trading range spans from ₹264.35 to ₹477.00, indicating significant price volatility over the past year. The current price sits closer to the lower end of this range, which may attract value investors seeking entry points amid market uncertainty.

Conclusion: Valuation Improvement Amidst Caution

Forbes & Company Ltd’s transition from an expensive to a fair valuation grade marks a pivotal moment for investors evaluating its price attractiveness. The company’s low P/E and PEG ratios relative to peers suggest potential undervaluation, especially when considering its strong historical returns and profitability metrics. However, the recent downgrade to a Strong Sell Mojo Grade and short-term price weakness underscore the need for caution.

Investors should weigh the improved valuation against operational risks and sector dynamics before committing capital. While the stock’s fair valuation may offer a more balanced risk-reward profile, alternative opportunities within the sector and broader market may provide superior prospects for portfolio growth and stability.

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