GRSE - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.4

📊 Core Financials Breakdown

Profitability

ROE: 27.6% and ROCE: 36.6% — exceptional, signaling superior capital efficiency.

EPS: ₹48.9 — strong earnings base, though recent PAT halved from ₹244 Cr to ₹120 Cr, likely due to project timing or accounting adjustments.

Debt-to-Equity: 0.00 — debt-free, a major strength for a capital-intensive defense manufacturer.

Dividend & Book Value

Dividend Yield: 0.53% — modest, but consistent.

Book Value: ₹182 — implies a P/B ratio of ~14.4, which is high but justified by strong ROE.

💰 Valuation Metrics

Metric Value Comment

P/E Ratio 53.7 Below industry average (75.3) — relatively fair

PEG Ratio 1.28 Acceptable — growth expectations priced in

Intrinsic Value ~₹2,400–₹2,500 CMP slightly above fair value zone

Valuation is elevated but supported by robust fundamentals and strategic positioning.

🚢 Business Model & Competitive Edge

Sector: Defense shipbuilding — long-cycle, government-backed, and strategically vital.

Strengths

Premier warship builder for the Indian Navy and Coast Guard.

Selected as L1 bidder for ₹2.5 trillion Next Gen Frigate program

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International expansion via MoU with Norway’s Kongsberg for polar research vessels

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Strong institutional interest — FII holding up (+1.48%)

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Challenges

Volatile quarterly profits due to milestone-based revenue recognition.

DII holding slightly down (-0.09%) — worth monitoring.

📉 Technicals & Entry Zone

Current Price: ₹2,627

DMA 50: ₹2,550 | DMA 200: ₹2,236 — bullish trend intact

RSI: 56.3 — neutral zone

MACD: Negative — short-term momentum cooling

📌 Suggested Entry Zone: ₹2,400–₹2,500

A dip near the 50 DMA would offer a better margin of safety for long-term accumulation.

🧭 Long-Term Holding Guidance

Hold if invested: Exceptional ROE/ROCE, zero debt, and strategic defense contracts make GRSE a high-quality long-term play.

Accumulate on dips: Ideal for investors seeking exposure to India’s defense modernization and export potential.

You can explore GRSE’s defense sector outlook and technical analysis or review recent performance trends and investor sentiment for deeper insights. Let me know if you'd like a peer comparison with Mazagon Dock or Cochin Shipyard.

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www.gate.com

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www.businesstoday.in

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