IGIL - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 4.2

📊 Financial Overview: IGIL (Inox Green Energy Services Ltd) demonstrates strong financial health with an impressive ROCE of 42.6% and ROE of 32.5%, reflecting excellent capital efficiency. The company is virtually debt-free with a debt-to-equity ratio of 0.01, enhancing its financial resilience. EPS stands at ₹11.7, and the P/E ratio of 29.5 is slightly above the industry average of 24.4, suggesting a modest premium. The PEG ratio of 0.83 indicates fair valuation relative to growth. PAT remained stable QoQ at ₹137 Cr vs ₹139 Cr, and the stock is trading below both its 50 DMA (₹352) and 200 DMA (₹384), signaling technical weakness.

💼 Business Model & Competitive Edge: IGIL operates in the renewable energy services space, offering O&M (operations and maintenance) services for wind energy assets. Its asset-light model, strong parentage, and long-term service contracts provide recurring revenue and a competitive edge. The company is well-positioned to benefit from India’s renewable energy expansion and policy support for green infrastructure.

📉 Valuation & Entry Zone: With RSI at 44.7 and MACD at -4.62, momentum is weak. The stock is down ~47% from its 52-week high of ₹642 and has rebounded ~20% from its low of ₹282. A favorable entry zone lies between ₹325–₹335, offering a good margin of safety for long-term investors.

📈 Long-Term Holding Guidance: IGIL is a strong long-term hold for investors seeking exposure to India’s renewable energy services sector. Its high return metrics, low leverage, and recurring revenue model support sustainable growth. Monitor order inflows, contract renewals, and sectoral policy developments for continued performance.

✅ Positive

• High ROCE (42.6%) and ROE (32.5%) reflect strong capital efficiency
• Debt-to-equity ratio of 0.01 ensures financial stability
• PEG ratio of 0.83 suggests fair valuation
• FII holdings increased by 0.37%

⚠️ Limitation

• Stock trading below both 50 DMA and 200 DMA
• Volume below weekly average indicates reduced investor interest
• DII holdings declined by 0.29%
• Dividend yield remains modest at 0.74%

📉 Company Negative News

• Stock down ~47% from 52-week high
• MACD and RSI indicate weak technical momentum

📈 Company Positive News

• Stable quarterly earnings with strong YoY profit growth (43%)
• Positive sentiment from foreign institutional investors
• Beneficiary of India’s renewable energy policy push

🏭 Industry

• Renewable energy services sector benefits from infrastructure expansion and climate goals
• Industry P/E of 24.4 reflects moderate valuation
• O&M services gaining traction with increasing wind energy installations

🧾 Conclusion

IGIL is a fundamentally strong renewable energy services provider with high return metrics, minimal debt, and a recurring revenue model. While technical indicators suggest short-term caution, its long-term growth outlook remains robust. Investors may consider accumulating near ₹325–₹335 for exposure to India’s green energy services boom.