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CGPOWER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.0
| Stock Code | CGPOWER | Market Cap | 1,11,276 Cr. | Current Price | 706 ₹ | High / Low | 798 ₹ |
| Stock P/E | 92.2 | Book Value | 48.7 ₹ | Dividend Yield | 0.18 % | ROCE | 35.8 % |
| ROE | 26.0 % | Face Value | 2.00 ₹ | DMA 50 | 684 ₹ | DMA 200 | 679 ₹ |
| Chg in FII Hold | -1.00 % | Chg in DII Hold | 1.26 % | PAT Qtr | 337 Cr. | PAT Prev Qtr | 307 Cr. |
| RSI | 52.9 | MACD | 11.8 | Volume | 16,06,518 | Avg Vol 1Wk | 37,21,932 |
| Low price | 518 ₹ | High price | 798 ₹ | PEG Ratio | 2.99 | Debt to equity | 0.01 |
| 52w Index | 67.4 % | Qtr Profit Var | 38.1 % | EPS | 7.60 ₹ | Industry PE | 33.0 |
📊 Financials
- Revenue Growth: PAT improved from 307 Cr. to 337 Cr. (+38.1% QoQ)
- Profit Margins: EPS at 7.60 ₹, modest relative to valuation
- Debt Ratios: Debt-to-Equity 0.01, virtually debt-free
- Cash Flows: Supported by strong industrial demand
- Return Metrics: ROE 26.0%, ROCE 35.8% — excellent efficiency
💹 Valuation
- P/E Ratio: 92.2 (extremely high vs Industry PE 33.0)
- P/B Ratio: ~14.5 (premium, reflects market optimism)
- PEG Ratio: 2.99 (suggests overvaluation relative to growth)
- Intrinsic Value: Current price (706 ₹) above DMA 50 (684 ₹) & DMA 200 (679 ₹), showing technical strength
🏢 Business Model & Competitive Advantage
- Leading player in power systems, transformers, and industrial solutions
- Competitive advantage in scale, technology, and diversified portfolio
- Debt-free balance sheet adds resilience
- Valuation stretched despite strong fundamentals
📈 Entry Zone Recommendation
- Entry Zone: 680–710 ₹ (near DMA support levels, RSI at 52.9)
- Long-Term Holding: Attractive for investors seeking industrial exposure, but caution due to high valuation
✅ Positive
- Strong ROCE (35.8%) and ROE (26.0%)
- Debt-free balance sheet
- DII holding increased (+1.26%)
- Quarterly PAT growth (+38.1%)
⚠️ Limitation
- Extremely high P/E ratio (92.2)
- PEG ratio suggests overvaluation
- EPS modest relative to market cap
📉 Company Negative News
- FII holding decreased (-1.00%)
- Valuation stretched far above industry average
📈 Company Positive News
- DII holding increased (+1.26%)
- Quarterly PAT improved significantly
- Strong technical support above DMA levels
🏭 Industry
- Industrial and power equipment industry growing with infrastructure demand
- Industry PE at 33.0, CG Power trades at a steep premium
🔎 Conclusion
CG Power is a strong industrial player with excellent return ratios and a debt-free balance sheet. However, valuations are stretched with a P/E of 92.2 and PEG of 2.99, far above industry averages. Entry around 680–710 ₹ may be considered, and long-term investors can hold for efficiency-driven growth, while monitoring valuation risks and institutional activity.