⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
GRSE - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.4
| Stock Code | GRSE | Market Cap | 28,877 Cr. | Current Price | 2,522 ₹ | High / Low | 3,538 ₹ |
| Stock P/E | 41.9 | Book Value | 200 ₹ | Dividend Yield | 0.55 % | ROCE | 36.6 % |
| ROE | 27.6 % | Face Value | 10.0 ₹ | DMA 50 | 2,483 ₹ | DMA 200 | 2,417 ₹ |
| Chg in FII Hold | -0.30 % | Chg in DII Hold | -0.35 % | PAT Qtr | 171 Cr. | PAT Prev Qtr | 154 Cr. |
| RSI | 53.3 | MACD | 19.7 | Volume | 48,44,682 | Avg Vol 1Wk | 37,67,252 |
| Low price | 1,180 ₹ | High price | 3,538 ₹ | PEG Ratio | 1.00 | Debt to equity | 0.01 |
| 52w Index | 56.9 % | Qtr Profit Var | 73.9 % | EPS | 60.2 ₹ | Industry PE | 56.2 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT increased from 154 Cr. to 171 Cr., reflecting strong growth momentum with 73.9% YoY profit variation.
- Margins: ROE at 27.6% and ROCE at 36.6% highlight excellent profitability and capital efficiency.
- Debt Ratios: Debt-to-equity at 0.01 indicates a virtually debt-free balance sheet.
- Cash Flows: Stable operating cash flows supported by long-term defense contracts.
- Return Metrics: High ROE and ROCE demonstrate superior capital allocation and operational strength.
💹 Valuation Indicators
- P/E Ratio: 41.9, below industry PE of 56.2, suggesting relative undervaluation.
- P/B Ratio: ~12.6 (Current Price / Book Value), reflecting premium valuation due to strong fundamentals.
- PEG Ratio: 1.00, fair valuation considering growth prospects.
- Intrinsic Value: Current price (2,522 ₹) is near fair value; upside potential exists with sector tailwinds.
🏢 Business Model & Competitive Advantage
- Operates in defense shipbuilding, a strategic sector with government-backed demand.
- Competitive advantage lies in specialized expertise, strong order book, and minimal debt.
- Resilient business model with predictable cash flows from defense contracts.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 2,300 ₹ – 2,450 ₹ (near DMA 200).
- Long-Term Holding: Strong fundamentals, government support, and sector growth make it suitable for long-term investors.
Positive
- Debt-free balance sheet.
- High ROE and ROCE.
- Strong profit growth and visibility of future orders.
Limitation
- High P/B ratio indicates expensive valuation.
- Low dividend yield (0.55%) may not attract income-focused investors.
- Dependence on government contracts limits diversification.
Company Negative News
- Reduction in FII (-0.30%) and DII (-0.35%) holdings, showing cautious institutional sentiment.
Company Positive News
- Quarterly PAT growth and strong defense sector demand.
- Consistent order inflows and execution efficiency.
Industry
- Defense sector enjoys strong government support and rising budget allocations.
- Industry PE at 56.2 indicates investor optimism and premium valuations.
Conclusion
- GRSE is a fundamentally strong, debt-free defense PSU with robust profitability.
- Valuation is slightly premium but justified by growth prospects.
- Best suited for long-term investors seeking exposure to defense sector growth.
I can also prepare a peer comparison with Mazagon Dock and Cochin Shipyard to highlight GRSE’s relative valuation and strengths if you’d like.