Top Low PE Ratio Stocks in India

The price-to-earnings ratio compares a company’s share price with its earnings per share. It is calculated as:

P/E = Market Price per Share ÷ Earnings per Share

For example, if a stock trades at ₹200 and its EPS is ₹20, the P/E ratio is 10. This means the stock is trading at 10 times its earnings per share.

Low PE stocks trade at lower earnings multiples than their benchmark, such as sector peers or the broader market. Since each sector has its own usual PE range, comparisons are more meaningful within the same industry. For example, if a stock trades at ₹50 and its EPS is ₹5, its PE is 10. Whether that is low depends on how similar companies are valued.

1. ICICI Bank Ltd: ICICI Bank Ltd is one of India’s largest private sector banks, offering retail, corporate, and investment banking services.
2. State Bank of India: State Bank of India (SBI) is India’s largest public sector bank, providing retail, corporate, and rural banking services.
3. Life Insurance Corporation of India (LIC): LIC is India’s largest life insurance company, wholly owned by the Government of India.
4. Axis Bank Ltd: Axis Bank Ltd is a large private-sector bank in India, offering retail, corporate, and digital banking services, with a nationwide branch presence and operations globally.
5. Kotak Mahindra Bank Ltd: Kotak Mahindra Bank Ltd is a major private-sector bank in India, offering retail, corporate, and treasury services.

Here is how you can invest in stocks with a low PE ratio:

1. Open a demat/trading/stockbroker account. You can open a demat account with smallcase!
2. Conduct thorough research into the top stocks with a low PE ratio in India using Tickertape Stocks Screener. The screener offers over 200 built-in filters, allowing investors to select parameters and generate a list of low PE stocks in India.
3. Place a ‘Buy’ Order on the top low PE stocks that align with your investment thesis.

• Below-Benchmark Valuations: Low PE stocks trade below the broader market or sector average. As of 30th March 2026, the Nifty 50 PE ratio stood at about 20.14, which provides a benchmark for comparison.
• Common in Cyclical Sectors: Low PE stocks are often seen in PSUs, metals, manufacturing, and select financials, where earnings and valuations can change sharply with economic and commodity cycles.
• Linked to Earnings Expectations: A low PE ratio often reflects muted earnings expectations, sector pressure, or uncertainty around future growth. In March 2026, India’s manufacturing PMI fell to a 4.5-year low.
• Used as a Relative Valuation Tool: The PE ratio is mainly used for comparison. A stock may appear cheap against the Nifty or peers, but that discount can also reflect business risk or weaker earnings visibility.

• Lower Entry Valuation: Low PE stocks trade at lower earnings multiples than many peers and the broader market. With the Nifty 50 PE at 20.14 in March 2026, lower-than-benchmark stocks can stand out on valuation screens.
• Potential for Re-Rating: If earnings improve or sector sentiment shifts, low-PE stocks can re-rate quickly. In FY2026, Hindalco rose about 30%, showing how cyclical stocks can recover.
• Useful in Comparative Analysis: Low PE stocks help compare valuations across sectors and companies. This became more relevant in FY2026, when the Nifty 50 fell 5.1%, and valuation gaps widened.
• More Common in Out-of-Favour Segments: Low PE stocks are often found in sectors under pressure. In FY2026, IT stocks fell 21.2%, showing how weaker sentiment can push valuations lower.

• Value Trap Risk: A stock may look cheap because the market expects weaker earnings, governance concerns, or structural pressure. A low PE does not always mean the stock is undervalued.
• Cyclical Earnings Pressure: Many low PE stocks are in cyclical sectors. In March 2026, India’s manufacturing PMI fell to 56.5, showing how slower demand can affect earnings.
• Macro Sensitivity: Low-PE stocks can be affected by macroeconomic stress. In FY2026, foreign investors withdrew $19.69 bn from Indian equities, while higher crude prices and a weaker rupee weighed on investor sentiment.
• Sector-Specific Weakness: Some stocks trade at low PEs because their sector is under pressure. In FY2026, IT stocks fell 21.2%, reflecting weaker demand and margin pressure.

• Compare with Sector Averages: A low PE ratio is more useful when compared with sector peers and the broader market. With the Nifty 50 PE at around 20.14, context matters.
• Earnings Quality: A low PE ratio should be interpreted alongside earnings quality. Cyclical, volatile, or weaker earnings can affect how such valuations are interpreted.
• Macro Conditions: Oil prices, currency moves, interest rates, and foreign flows can shape sentiment. In late March 2026, Brent crude crossed $115 per barrel, and the rupee touched a record low.
• Beyond PE as a Metric: The PE ratio shows only one side of valuation. Debt, cash flow, return ratios, and earnings consistency also help provide a fuller view of a company’s financial position.