Earnings Working Against Jindal Saw Limited’s (NSE:JINDALSAW) Share Price
With a price-to-earnings (or “P/E”) ratio of 9.3x Jindal Saw Limited (NSE:JINDALSAW) may be sending very bullish signals at the moment, given that almost half of all companies in India have P/E ratios greater than 33x and even P/E’s higher than 62x are not unusual. Nonetheless, we’d need to dig a little deeper to determine if there is a rational basis for the highly reduced P/E.
With earnings growth that’s superior to most other companies of late, Jindal Saw has been doing relatively well. One possibility is that the P/E is low because investors think this strong earnings performance might be less impressive moving forward. If not, then existing shareholders have reason to be quite optimistic about the future direction of the…
