3 Midcap Gems with EBITDA Margin of Over 70%!

  • Stock Market Analysis
  • Editors Pick

Earnings before interest, tax, depreciation and amortization, or simply EBITDA is a good metric to judge the company’s performance and is also a loose proxy to the cash flows from its operations.

For those looking to add some of the strongest companies to their portfolios, here’s a list of 3 midcaps that have clocked the highest EBITDA margins in FY23.

HDFC Asset Management Company Limited

HDFC Asset Management Company Ltd (NS: HDFA ) is an AMC with a market capitalization of INR 51,235 crore. The company clocked a revenue of INR 2,482.62 crore in FY23 which might not seem much for a company this big, however, its EBITDA of INR 1,923.4 crore is worth noting. This translates into a gigantic EBITDA margin of 77.47%.

This makes this company the best among all 250 midcap counters on the NSE. The stock has also delivered a 20% return in the last one year, and there is strong support around INR 2,314 (CMP INR 2,406.3) on the weekly chart, where investors can think of making a purchase.

SJVN Limited

SJVN Ltd (NS: SJVN ) is in the business of the generation and sale of power, having a market capitalization of INR 22,498 crore. The stock trades at an attractive TTM P/E of 16.55, despite a mammoth 102.4% rally in the last 12 months. It is also a very good dividend stock, currently trading at a yield of 5.8%.

Over a revenue of INR 3,286.75 crore in FY23, the company managed to clock an EBITDA of INR 2,538.64 crore, translating into a hefty margin of 77.4%. The stock has rallied quite sharply since April 2023 (CMP INR 57) and a retracement to INR 42 might present a good opportunity to accumulate this potential multibagger.

Embassy Office Parks REITs

Embassy Office Parks REIT (NS: EMBA ) is a real estate investment trust with a market capitalization of INR 32,216 crore. All REITs are good dividend options and this one is no different with a current dividend yield of 6.39% and has maintained a massive payout ratio of 3.01 (avg) for the last 3 fiscal years.

The core business of a REIT is income generating through rent and it garnered a revenue of INR 3,641.42 crore in FY23, over which it clocked an EBITDA of INR 2,766.25 crore, which is a superb margin of 75.97%, making it the 3rd best-performer in the mid-cap space.

Apart from these 3, no other mid-cap company was able to surpass an EBITDA margin of 70% in FY23.

Read More: Stock Goes Against the Grain, Breaks Hurdle with 5% Rally!

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  • Vivek Purav @Vivek Purav
    SJVN FAIR VALUE IS 69. IS IT FEASIBLE TO BUY AT SO HIV VALUE.
    Like 0
    • Vivek Purav @Vivek Purav
      high value
      Like 0
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  • Dilip Gjosh @Dilip Gjosh
    You always guide genuinely
    Like 3
    • Aayush Khanna @Aayush Khanna
      I always try to :)
      Like 1
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  • Danish Ahmed @Danish Ahmed
    need help !
    Like 1
  • Vivek Duggal @Vivek Duggal
    Great analysis
    Like 3
    • Aayush Khanna @Aayush Khanna
      Thanks, Vivek.
      Like 0
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