The Market Lifts JTL Industries Limited (NSE:JTLIND) Shares 26% But It Can Do More

Simply Wall St · 4d ago

JTL Industries Limited (NSE:JTLIND) shareholders would be excited to see that the share price has had a great month, posting a 26% gain and recovering from prior weakness. Unfortunately, the gains of the last month did little to right the losses of the last year with the stock still down 31% over that time.

Although its price has surged higher, you could still be forgiven for feeling indifferent about JTL Industries' P/E ratio of 30.1x, since the median price-to-earnings (or "P/E") ratio in India is also close to 29x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/E.

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While the market has experienced earnings growth lately, JTL Industries' earnings have gone into reverse gear, which is not great. One possibility is that the P/E is moderate because investors think this poor earnings performance will turn around. You'd really hope so, otherwise you're paying a relatively elevated price for a company with this sort of growth profile.

See our latest analysis for JTL Industries

pe-multiple-vs-industry
NSEI:JTLIND Price to Earnings Ratio vs Industry June 10th 2025
If you'd like to see what analysts are forecasting going forward, you should check out our free report on JTL Industries.

Does Growth Match The P/E?

JTL Industries' P/E ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the market.

Taking a look back first, the company's earnings per share growth last year wasn't something to get excited about as it posted a disappointing decline of 22%. The last three years don't look nice either as the company has shrunk EPS by 2.5% in aggregate. Accordingly, shareholders would have felt downbeat about the medium-term rates of earnings growth.

Shifting to the future, estimates from the five analysts covering the company suggest earnings should grow by 34% per year over the next three years. Meanwhile, the rest of the market is forecast to only expand by 21% per year, which is noticeably less attractive.

In light of this, it's curious that JTL Industries' P/E sits in line with the majority of other companies. It may be that most investors aren't convinced the company can achieve future growth expectations.

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The Bottom Line On JTL Industries' P/E

Its shares have lifted substantially and now JTL Industries' P/E is also back up to the market median. It's argued the price-to-earnings ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.

Our examination of JTL Industries' analyst forecasts revealed that its superior earnings outlook isn't contributing to its P/E as much as we would have predicted. There could be some unobserved threats to earnings preventing the P/E ratio from matching the positive outlook. It appears some are indeed anticipating earnings instability, because these conditions should normally provide a boost to the share price.

You need to take note of risks, for example - JTL Industries has 2 warning signs (and 1 which is potentially serious) we think you should know about.

You might be able to find a better investment than JTL Industries. If you want a selection of possible candidates, check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).