Saint-Gobain Sekurit India Ltd Valuation Shifts Amid Mixed Market Performance

Valuation Metrics and Recent Changes

As of 1 Feb 2026, Saint-Gobain Sekurit India Ltd trades at a price of ₹101.40, marginally up 0.45% from the previous close of ₹100.95. The company’s price-to-earnings (P/E) ratio currently stands at 21.64, a figure that has contributed to its reclassification from very expensive to expensive in valuation terms. This P/E ratio is elevated compared to several peers in the Auto Components & Equipments sector, signalling a premium valuation that investors should scrutinise carefully.

The price-to-book value (P/BV) ratio is also high at 4.23, reinforcing the notion that the stock is priced above its net asset value by a significant margin. Other valuation multiples such as EV to EBIT (16.94) and EV to EBITDA (15.74) further underline the premium nature of the stock’s current market price.

Despite these elevated multiples, the company’s return on capital employed (ROCE) is exceptionally strong at 98.91%, and return on equity (ROE) is a healthy 19.53%. These robust profitability metrics partially justify the premium valuation, indicating efficient capital utilisation and solid earnings generation.

Comparative Analysis with Peers

When compared with key competitors, Saint-Gobain Sekurit’s valuation appears stretched. For instance, Empire Industries, a peer in the same sector, is rated as very attractive with a P/E of 14.79 and an EV to EBITDA of 8.48, substantially lower than Saint-Gobain Sekurit’s multiples. Similarly, Haldyn Glass, another competitor, also holds a very attractive valuation with a P/E of 21.24 but a notably lower EV to EBITDA of 9.96.

Conversely, some companies such as Jai Mata Glass and Triveni Glass are classified as risky due to loss-making operations, while FGP is considered risky with a P/E of 49.28, indicating a wide valuation dispersion within the sector. Agarwal Toughene, with a P/E of 11.13, does not qualify for direct comparison due to differing business fundamentals.

This peer comparison highlights that while Saint-Gobain Sekurit commands a premium, it is not without precedent in the sector, but investors must weigh this against the company’s growth prospects and profitability metrics.

Stock Performance and Market Context

Over the past year, Saint-Gobain Sekurit India Ltd has underperformed the broader Sensex index, delivering a negative return of -13.26% compared to the Sensex’s positive 7.18%. This underperformance is notable given the company’s premium valuation, raising questions about the sustainability of its current price multiples.

Year-to-date, the stock has declined by 4.16%, slightly worse than the Sensex’s 3.46% fall. However, over longer horizons, the stock has shown resilience, with a 5-year return of 58.93% and a 10-year return of 143.17%, albeit still lagging the Sensex’s 77.74% and 230.79% respectively. This mixed performance suggests that while the company has delivered value over the long term, recent market conditions and sectoral pressures have weighed on its near-term returns.

Quality and Growth Considerations

Saint-Gobain Sekurit’s PEG ratio of 0.76 indicates that the stock is trading at a reasonable price relative to its earnings growth, which could be a mitigating factor against its elevated P/E. The dividend yield of 1.97% adds modest income appeal, though it is not a primary driver for investors in this growth-oriented stock.

The company’s strong ROCE and ROE metrics underscore operational efficiency and effective capital deployment, which are critical in the capital-intensive auto components sector. These factors may support the premium valuation, provided the company sustains its growth trajectory and profitability.

Risks and Valuation Challenges

Despite the positives, the shift from very expensive to expensive valuation grade signals a slight deterioration in price attractiveness. Investors should be cautious given the stock’s high P/BV ratio and the premium multiples relative to peers. The auto components sector is subject to cyclical demand fluctuations, raw material cost pressures, and regulatory changes, all of which could impact earnings visibility.

Moreover, the company’s Mojo Score of 37.0 and a downgrade from Hold to Sell on 6 Nov 2025 reflect a cautious stance by analysts, suggesting that the current valuation may not fully compensate for the risks involved. The Market Cap Grade of 4 indicates a smaller market capitalisation, which can entail higher volatility and liquidity considerations.

Investor Takeaway

Saint-Gobain Sekurit India Ltd’s recent valuation adjustment from very expensive to expensive reflects a nuanced shift in market sentiment. While the company’s strong profitability metrics and growth prospects justify a premium, the elevated P/E and P/BV ratios relative to peers and historical averages warrant caution.

Investors should carefully weigh the company’s operational strengths against valuation risks and sectoral headwinds. The downgrade in Mojo Grade to Sell and the modest market cap grade further suggest that the stock may face near-term challenges in delivering superior returns.

For those considering exposure to the Auto Components & Equipments sector, a comparative analysis with more attractively valued peers such as Empire Industries and Haldyn Glass may be prudent. These alternatives offer compelling valuations with solid fundamentals, potentially providing better risk-adjusted returns.

Ultimately, Saint-Gobain Sekurit remains a company with strong fundamentals but currently trades at a valuation that demands careful scrutiny and selective entry points for investors prioritising value and margin of safety.

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