As of the latest market close, Rajratan Global Wire’s stock price settled at ₹452.00, down from the previous close of ₹479.00, with intraday trading ranging between ₹446.30 and ₹475.00. The stock’s 52-week price band spans from ₹250.00 to ₹521.95, indicating a wide trading range over the past year. Despite a one-week return of -2.68%, the stock has recorded a 38.44% return over the past month, contrasting with the Sensex’s 1.47% gain during the same period. However, the year-to-date and one-year returns for Rajratan Global Wire stand at -6.68% and -11.54% respectively, compared to Sensex returns of 9.02% and 9.81%, highlighting a divergence from broader market trends.
Examining the valuation metrics, the company’s P/E ratio currently stands at 39.17, which is categorised as attractive when compared to its peer group. For context, Endurance Technologies, another player in the Auto Components sector, holds a P/E of 43.93, while Motherson Wiring reports a higher P/E of 52.6. Other peers such as TVS Holdings present a notably lower P/E of 20.98, reflecting a varied valuation landscape within the sector.
The price-to-book value for Rajratan Global Wire is recorded at 3.81, a figure that suggests a moderate premium over the book value of its assets. This valuation parameter, when juxtaposed with the company’s return on capital employed (ROCE) of 11.08% and return on equity (ROE) of 9.72%, provides insight into the efficiency with which the company utilises its capital base to generate earnings. The dividend yield remains modest at 0.44%, indicating a limited cash return to shareholders relative to the stock price.
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Further valuation multiples such as enterprise value to EBITDA (EV/EBITDA) and enterprise value to EBIT (EV/EBIT) stand at 20.16 and 25.29 respectively for Rajratan Global Wire. These ratios are positioned below several peers including Motherson Wiring (EV/EBITDA of 31.42) and Gabriel India (38.28), but above TVS Holdings’ 7.40, indicating a mid-range valuation stance within the sector. The EV to capital employed ratio of 2.80 and EV to sales ratio of 2.60 also contribute to the overall assessment of the company’s market valuation relative to its operational scale.
When analysing the PEG ratio, which adjusts the P/E ratio for earnings growth, Rajratan Global Wire reports a value of 0.00, a figure that may reflect either a lack of reported growth estimates or a specific analytical treatment. Comparatively, peers such as Endurance Technologies and ZF Commercial report PEG ratios of 3.24 and 2.84 respectively, suggesting differing growth expectations across the sector.
Looking at the longer-term performance, Rajratan Global Wire’s returns over five and ten years are striking, with gains of 415.69% and 3020.32% respectively, significantly outpacing the Sensex’s 95.38% and 229.64% returns over the same periods. This historical outperformance underscores the company’s capacity for value creation over extended horizons, despite recent fluctuations and valuation shifts.
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In the context of market capitalisation, Rajratan Global Wire holds a mid-tier position with a market cap grade of 3, reflecting its standing among peers in the Auto Components & Equipments sector. The sector itself is characterised by a broad spectrum of valuation levels, with companies ranging from attractive to expensive classifications based on their respective financial metrics.
The recent revision in the company’s evaluation metrics, particularly the shift from an expensive to an attractive valuation grade, signals a change in market perception that may influence investor interest. This adjustment aligns with the company’s current P/E and P/BV ratios relative to historical averages and peer comparisons, suggesting a recalibration of price expectations.
Investors analysing Rajratan Global Wire should consider the interplay between valuation parameters and operational performance indicators such as ROCE and ROE. While the company’s returns on capital and equity indicate moderate efficiency, the valuation multiples suggest a more accessible entry point compared to some of its more richly valued competitors.
Moreover, the stock’s recent price movements and returns relative to the Sensex highlight the importance of sector-specific dynamics and company-specific factors in shaping investment outcomes. The divergence in short-term returns compared to the broader market emphasises the need for a nuanced approach when assessing Rajratan Global Wire’s market position.
Overall, the shift in valuation parameters for Rajratan Global Wire reflects a broader market reassessment that may open new avenues for investors seeking exposure to the Auto Components & Equipments sector. The company’s historical performance, combined with its current valuation stance, provides a comprehensive framework for evaluating its potential role within a diversified portfolio.
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