GPIL - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 4.0

🧾 Core Financials & Profitability

EPS (₹12.1) and PAT (₹221 Cr) show growth from the previous quarter (₹145 Cr), though YoY momentum needs validation.

ROCE (23.3%) & ROE (17.3%): Healthy efficiency indicators—above average for mid-cap industrials.

Debt-to-Equity (0.06): Almost nil—excellent capital structure for long-term resilience.

Dividend Yield (0.52%): Small but steady; growth orientation reflected.

💰 Valuation Metrics

Metric Value Interpretation

P/E Ratio 16.0 Attractive relative to industry PE (23.8)

P/B Ratio ~2.65 Fair valuation; below sector average for manufacturing

PEG Ratio -0.97 Indicates earnings growth issues or inconsistency

Intrinsic Value — Estimated ~₹210–₹225 — slightly undervalued zone

🔍 Looks reasonably priced based on earnings and book metrics. However, PEG being negative suggests uncertain forward growth.

🏗️ Business Model & Market Position

Domain: GPIL (Godawari Power & Ispat Ltd.) operates in steel, iron ore, and energy—integrated manufacturing with captive resources.

Strengths

Raw material backward integration (iron ore, power) cushions margin volatility.

Low debt and improving profit cycle benefit during commodity upcycles.

Risks

Highly cyclical sector with price-dependent margins.

FII mild exit (-0.07%) may reflect global demand concerns.

📈 Technicals & Entry Opportunity

Current Price: ₹194

DMA 50 / 200: ₹188 / ₹187 — hovering near support levels

RSI (58.7): Neutral—neither hot nor cold

MACD (1.61): Mild positive momentum

Volume Spike: Slight uptick in buying interest

🛒 Suggested Entry Zone: ₹182–₹190 Ideal zone near DMA support with RSI below 60. Consider staggered entry for volatility protection.

🔮 Long-Term Outlook

GPIL fits well in a cyclical basket strategy

Holds promise during infrastructure booms and steel supercycles

Low gearing ensures flexibility to weather downturns

ROCE >20% consistently is a sign of strong operational command

Monitor raw material price trends, government infra spending, and export demand outlook.

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