Value stocks: Stocks having high RoE, high growth & low P/E

Value investing is all about buying stocks at attractive valuations. Normally, high growth stocks reflect a high RoE and trade at a high P/E multiple.

We find two stocks are trading at a P/E multiple of below the industry average P/E and reflecting higher RoE & higher growth rate. The two stocks are Coromandel International & Alembic Pharmaceuticals. 

Both the stocks are showing sales growth greater than 20 per cent on a YoY basis and their quarterly profit growth is also greater than 20 per cent on a YoY basis. The average return on capital employed for 3 years is greater than 20 for both the stocks. While the growth is impressive; both the stocks are trading below the P/E multiple of 20. 

The dividend yield for Coromandel International is 1.48 per cent while that for Alembic Pharmaceuticals is 1.04 per cent. Alembic Pharmaceuticals is up by 68 per cent on a YTD basis while Coromandel International has gained 53 per cent during the period. In one year, Coromandel International has doubled while Alembic Pharmaceuticals has gained 91 per cent.