Tourism Finance Corporation of India Limited (NSE:TFCILTD) shares have continued their recent momentum with a 28% gain in the last month alone. The annual gain comes to 276% following the latest surge, making investors sit up and take notice.
Even after such a large jump in price, Tourism Finance Corporation of India’s price-to-earnings (or “P/E”) ratio of 24.1x might still make it look like a buy right now compared to the market in India, where around half of the companies have P/E ratios above 32x and even P/E’s above 59x are quite common. However, the P/E might be low for a reason and it requires further investigation to determine if it’s justified.
Tourism Finance Corporation of India has been doing a good job lately as it’s been growing earnings at a solid pace. It might be that many expect the respectable earnings performance to degrade substantially, which has repressed the P/E. If you like the company, you’d be hoping this isn’t the case so that you could potentially…
