Valuation Metrics: A Closer Look
As of 11 Feb 2026, Shree Ajit Pulp trades at ₹259.60, up 5.74% from the previous close of ₹245.50. The stock’s 52-week range spans from ₹180.00 to ₹293.95, indicating a strong recovery and resilience over the past year. The company’s price-to-earnings (P/E) ratio currently stands at 9.44, a figure that is comfortably below the sector’s more expensive peers such as Seshasayee Paper (P/E 19.62) and Andhra Paper (P/E 71.06), underscoring its relative valuation appeal.
Price-to-book value (P/BV) is another key metric where Shree Ajit Pulp shows strength, with a ratio of 0.89. This sub-1 multiple suggests the stock is trading below its book value, a classic indicator of undervaluation in the eyes of value investors. Comparatively, many peers such as N R Agarwal Industries and Emami Paper trade at significantly higher multiples, reflecting either premium valuations or differing growth expectations.
Enterprise value to EBITDA (EV/EBITDA) ratio of 5.88 further supports the stock’s attractive valuation status. This metric is well below the levels seen in riskier or very expensive peers like Andhra Paper (EV/EBITDA 15.07) and Seshasayee Paper (12.01), signalling a more reasonable price relative to operating earnings.
Financial Performance and Returns
Shree Ajit Pulp’s return on capital employed (ROCE) is 10.39%, while return on equity (ROE) stands at 7.20%. These figures, while moderate, indicate efficient capital utilisation and profitability, especially when viewed alongside the company’s low valuation multiples. The PEG ratio of 0.05 is particularly noteworthy, suggesting that the stock’s price is low relative to its earnings growth potential, a highly favourable sign for growth-oriented investors.
In terms of market performance, the stock has outperformed the benchmark Sensex across multiple time frames. Over the past week, Shree Ajit Pulp surged 13.12% compared to Sensex’s 0.64%. Over one year, the stock returned 23.91%, significantly ahead of the Sensex’s 9.01%. Even on a longer horizon, the company has delivered a 127.23% return over five years, doubling the Sensex’s 64.25% gain, highlighting its strong growth trajectory and investor confidence.
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Comparative Valuation: Sector and Peer Analysis
Within the Paper, Forest & Jute Products sector, Shree Ajit Pulp’s valuation stands out as attractive, especially when juxtaposed with peers. For instance, Soma Papers is classified as very expensive and is currently loss-making, rendering its valuation metrics less meaningful. Seshasayee Paper and Andhra Paper are also marked as very expensive or risky, with P/E ratios of 19.62 and 71.06 respectively, and EV/EBITDA multiples far exceeding Shree Ajit’s.
Other peers such as T N Newsprint and Pudumjee Paper share an attractive valuation status, with P/E ratios of 33.74 and 8.5 respectively, and EV/EBITDA multiples close to Shree Ajit’s range. Kuantum Papers and Satia Industries are noted as very attractive, but their P/E ratios (14.45 and 10.1) and EV/EBITDA (8.29 and 4.69) differ, reflecting varying operational efficiencies and growth prospects.
This comparative framework highlights Shree Ajit Pulp’s balanced valuation profile, combining reasonable price multiples with solid operational metrics, making it a compelling candidate for investors seeking value within the sector.
Market Capitalisation and Mojo Score Upgrade
Shree Ajit Pulp’s market capitalisation grade is rated 4, indicating a mid-cap status with substantial liquidity and market presence. The company’s Mojo Score has recently been upgraded from 70 (Buy) to 82 (Strong Buy) as of 10 Feb 2026, reflecting improved fundamentals and valuation attractiveness. This upgrade signals increased confidence from analysts and market participants, reinforcing the stock’s appeal.
The upgrade is supported by the company’s consistent earnings, attractive valuation multiples, and superior relative returns compared to the Sensex. The strong Mojo Grade also suggests that the stock is well-positioned to benefit from sector tailwinds and operational efficiencies.
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Investment Implications and Outlook
The shift in valuation grade from very attractive to attractive for Shree Ajit Pulp and Paper Ltd reflects a nuanced market reassessment. While the stock remains undervalued relative to book value and earnings, the upgrade suggests that some of the previous undervaluation has been priced in following recent price appreciation.
Investors should note that the company’s PEG ratio of 0.05 indicates significant earnings growth potential relative to price, a rare and compelling feature in the mid-cap paper sector. The moderate ROCE and ROE figures, combined with strong relative returns, suggest operational stability and growth prospects that justify the current valuation.
However, the sector remains competitive, and peers with very attractive valuations such as Satia Industries and Kuantum Papers may offer alternative opportunities. Additionally, the absence of a dividend yield for Shree Ajit Pulp may be a consideration for income-focused investors.
Overall, the stock’s recent price movement, valuation metrics, and upgraded Mojo Grade position it favourably for investors seeking a blend of value and growth within the Paper, Forest & Jute Products sector.
Historical Price and Return Context
Examining the stock’s price trajectory, Shree Ajit Pulp has demonstrated robust performance over the medium to long term. Its 3-year return of 49.22% and 5-year return of 127.23% significantly outpace the Sensex’s respective returns of 38.88% and 64.25%. Even over a decade, the stock has delivered a 208.45% return, underscoring its capacity to generate wealth for long-term shareholders despite sector cyclicality.
Shorter-term returns also highlight momentum, with a 13.12% gain in the past week and 5.96% over the last month, far exceeding the Sensex’s modest gains. This momentum, coupled with attractive valuation metrics, suggests continued investor interest and potential for further upside.
Conclusion
Shree Ajit Pulp and Paper Ltd’s valuation shift from very attractive to attractive is a positive development that reflects both market recognition of its fundamentals and a partial re-rating of the stock. Its low P/E and P/BV ratios, combined with strong relative returns and an upgraded Mojo Grade of Strong Buy, make it a compelling proposition within the Paper, Forest & Jute Products sector.
While the valuation is no longer at the extreme undervaluation levels seen previously, the stock remains favourably priced relative to peers and historical averages. Investors looking for a mid-cap stock with a blend of value and growth characteristics would do well to consider Shree Ajit Pulp as part of a diversified portfolio.
Continued monitoring of sector dynamics, earnings growth, and valuation trends will be essential to gauge the stock’s trajectory. For now, the company’s improved valuation profile and strong market performance provide a solid foundation for investor confidence.
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