Best Stocks to Buy in India for Short term – Amara Raja Batteries Ltd

Our 15th company in the Series of Best Stocks to Buy in India for Short term 2021 is Amara Raja Batteries Ltd.

This company is good for investing purpose or not ?

Let’s start with the Company profile

Company Profile :

Amara Raja Batteries Limited is a manufacturer of lead-acid storage batteries for industrial and automotive applications in India.

Now Let’s check the important fundamental figures of this company. This is a small cap company with Market Cap ₹11,945cr. We can check more fundamental details below in depth:

Company Fundamental Detail :

PE Ratio: 18.47

Sector PE Ratio: 61.74

PE Ratio of this company is low than Sector’s PE. So it’s a Good PE than the peers of this company.

PB Ratio : 2.84

Sector PB Ratio :4.59

PB Ratio of this company is low than Sector’s PB ratio. So it’s Good PB than the peers of this company.

Dividend Yield : 1.57%

Sector Dividend Yield : 0.74%

Dividend Yield of this company is high than Sector. Dividend of this is Average than the peers of this company.

ROE: 15.36%

ROCE: 19.78%

ROE (Return on equity) and ROCE (Return on capital equity) is Below Average

According to above data, this company is looking fundamentally average. Now We’ll check the company Financially data:

Company Financial Detail

20206,894.22 660.80

We should check now liabilities of company also in the below table

Total Current & Non Current Liabilities

2021  2020 2019  2018

Liabilities of a company refers to the debt of that company. We should also aware the debt of company. In 2021 , Company have 1,586.90 Cr. debt.

Let’s check the Free Cash flow of the company

Free Cash flow

2021  2020 2019  2018

Debt Level: Amara Raja Batteries Ltd debt to equity ratio (2.2%) is considered satisfactory.

Reducing Debt: Amara Raja Batteries Ltd debt to equity ratio has reduced from 3.5% to 2.2% over the past 5 years.

Debt Coverage: Amara Raja Batteries Ltd debt is well covered by operating cash flow (868.9%).

Interest Coverage: Amara Raja Batteries Ltd earns more interest than it pays, so coverage of interest payments is not a concern.

Share Holding Pattern

Promotor HoldingForeign Institution
Mutual Fund
Other Domestic InstitutionsRetail & Others
Jun 2021 28.06% 20.82%5.80% 8.72%36.60%
Mar 202128.06%22.10% 7.84% 7.22%34.77%
Dec 202028.06%21.34%5.86%6.68%38.06%
Sep 202028.06%20.91%7.96%6.46%36.61%

Above table showing there is no big change in Promotor Holding which is 28.06% in June 2021. FIIs invested in June 2021 with 20.82% and retail investor is 36.60%.

Investment Checklist for Amara Raja Batteries Ltd.

  • The company is currently profitable
  • Earnings have grown by 7.7% per year over past 5 years
  • Debt level is low and not considered a risk
  • Dividend of 1.57% is sustainable
  • Share price has been stable over the past 3 months
  • The company’s earnings are high quality
  • Profit margins decreased but not substantially
  • At least 3 years of financial data is available
  • No concerning events detected
  • Shareholders have not been meaningfully diluted in the past year or recently listed
  • Revenue is meaningful (₹79B)
  • Market cap is meaningful (₹120B)
  • Amara Raja Batteries Ltd does not have negative shareholders equity.
  • No 3 month insider trading information

According to its historical performance we can predict stock target.

Entry Buying Zone : Premium members can see only

Target: Premium members can see only

Time Horizon:Premium members can see only

Risk Profile: Premium members can see only

Hope you liked Our 15th company in the Series of Best stocks to buy in India for short term 2021. We tried to cover many important things about this company, if you think anything left to cover, you can comment us and we’ll try to cover those things also.

Disclaimer: This is an Educational Initiative and is NOT registered under any SEBI regulations. All the information that we provide is just for Educational purposes and you should consult your financial adviser before taking any investment decision. Also we do NOT provide any form of Stock Tips or Advise on stocks or portfolios. My All Trades Only Education Purpose. All trades will be at your risk. You have the responsibility of any trade or any benefit or loss

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