-109.16
81,442.47
-0.13%
1,416
-0.4%
1,922.85
-0.2%
3.95
3,502.85
0.11%
1,860
0.87%
1,452.15
0.35%
2.9
796.7
0.37%
1,578.5
0.51%
9,262.95
0.98%
2,372.55
-0.35%
929.95
6.76%
-13.1
420.8
-3.02%
3,645.5
0.11%
1,652.6
0.01%
2,069.65
-0.44%
1,683
-0.04%
12,350
-0.55%
3,009.65
-0.99%
1,196.9
0.08%
11,321.4
-0.87%
5,046.95
0.34%
1.3
339.9
0.38%
2,035.8
0.28%
-19.75
3,572
-0.55%
-1.7
242.85
-0.7%
1,412.05
0.54%
2,531.45
-0.37%
392.45
1.84%
293
-0.59%
4,064.7
-0.71%
719.8
0.47%
-0.7
247.55
-0.28%
-169.35
8,792.3
-1.89%
1,005.8
-0.79%
398
-0.52%
-42.6
2,419.6
-1.73%
2,307.3
-0.93%
-0.75
223.7
-0.33%
559.3
1.17%
5,315.05
0.04%
143.55
0.17%
161.2
-0.31%
-4.35
5,570.4
-0.08%
-1
773.2
-0.13%
454
0.59%
293.2
0.58%
140.4
0.5%
1,806.5
0.12%
2,594.55
-0.76%
6,706.35
0.15%
-2.25
445.7
-0.5%
-109.16
81442.47
-0.13%

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ValueProductView

ValueProductPastPerformance

Company NameReco DateReco PriceExit PriceExit Date% ReturnIn days
Bharat Forge Ltd. 25/07/20241,593.85952.3007/04/2025 -40.25% 256 days
ITC Ltd. 28/12/2023464.20487.5002/01/2025 5.02% 1 yrs
Britannia Industries Ltd. 27/07/20234,875.805,028.2512/11/2024 3.13% 1 yrs
JSW Steel Ltd. 22/02/2024826.951,003.0026/09/2024 21.29% 217 days
Bajaj Auto Ltd. 22/08/20249,910.0011,930.0017/09/2024 20.38% 26 days
Dr. Reddy's Laboratories Ltd. 26/10/20235,429.306,536.0005/07/2024 20.38% 253 days
Shriram Finance Ltd. 25/04/20242,430.102,955.0028/06/2024 21.60% 64 days
Coal India Ltd. 25/01/2024389.50501.6022/05/2024 28.78% 118 days
Infosys Ltd. 27/10/20221,522.601,411.6019/04/2024 -7.29% 1 yrs
State Bank Of India 25/05/2023581.30782.0505/03/2024 34.53% 285 days

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9.10 P/E ratio (Price-earnings ratio)

Ratio Analysis

This is obtained as follows

Market Price Of The Share----------------------------------------------
EPS

For instance, as on October 20, 2003, the market price of TISCO was Rs 346.80. Its P/E ratio on that day was 346.80/27.51 = Rs 12.60.

Relevance Of PE Ratio:

This is the most important ratio for guessing the price of a share. The P/E ratio indicates the number of times the price of a share is more than its EPS. A company having a P/E ratio of eight has its price eight times over its EPS.

Which factors influence the P/E ratio?

The P/E ratio is a derivative of all stock-specific and market- specific factors that influence the price. For instance,

  1. P/E ratio of a company remains very high when the company has maintained sound financial health over the years.
  2. P/E ratio remains high when the management has consistently shown a good record. It does not go up if the investors do not trust the management. For instance, all Tata companies have high P/E ratios.
  3. If a company is a market leader having strong manufacturing, marketing and financial operations and has sound future plans, its P/E remains high. Blue chips like ITC, HLL, etc fall into this category.
  4. P/E ratio of any growth-oriented company is very high. A company like Divi’s Laboratories, which has grown substantially in the last few years, understandably has a high P/E ratio.
  5. When investors have high expectations about the future potential of some industry, the P/E ratios of all companies in that industry go up. Poor expectation about any industry results in a fall of the P/E ratios of all companies belonging to that industry. For instance, the average P/E ratio for the cement companies soared to 35 in July 1991, while the average P/E ratio of electronics’ companies languished at 17.6.
  6. P/E ratios of all companies go up during the bullish market and fall during the bearish phase.
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