JPPOWER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.9
| Stock Code | JPPOWER | Market Cap | 10,191 Cr. | Current Price | 14.9 ₹ | High / Low | 27.7 ₹ |
| Stock P/E | 13.8 | Book Value | 18.6 ₹ | Dividend Yield | 0.00 % | ROCE | 10.2 % |
| ROE | 6.83 % | Face Value | 10.0 ₹ | DMA 50 | 16.9 ₹ | DMA 200 | 17.6 ₹ |
| Chg in FII Hold | 0.17 % | Chg in DII Hold | -0.16 % | PAT Qtr | 182 Cr. | PAT Prev Qtr | 278 Cr. |
| RSI | 35.3 | MACD | -0.72 | Volume | 3,13,98,587 | Avg Vol 1Wk | 5,21,15,280 |
| Low price | 12.4 ₹ | High price | 27.7 ₹ | PEG Ratio | 0.14 | Debt to equity | 0.28 |
| 52w Index | 16.5 % | Qtr Profit Var | -0.04 % | EPS | 1.08 ₹ | Industry PE | 25.6 |
📊 Financials: JPPOWER shows weak fundamentals with ROCE at 10.2% and ROE at 6.83%, reflecting modest capital efficiency. Debt-to-equity ratio of 0.28 indicates manageable leverage. Quarterly PAT declined from 278 Cr. to 182 Cr., with negligible profit variation (-0.04%), highlighting earnings stagnation. EPS of 1.08 ₹ is very low relative to market cap, limiting shareholder value creation. Cash flows remain under pressure due to weak profitability.
💹 Valuation: Current P/E of 13.8 is below the industry average of 25.6, suggesting undervaluation relative to peers. P/B ratio is ~0.80 (Current Price / Book Value), which is attractive. PEG ratio of 0.14 indicates potential undervaluation if growth sustains. Intrinsic value appears slightly higher than CMP, offering some margin of safety for investors.
🏢 Business Model & Competitive Advantage: JPPOWER operates in the power generation sector, with exposure to thermal and hydro projects. While scale and diversification provide resilience, weak return ratios, low profitability, and lack of dividend yield reduce its competitive edge compared to peers. High trading volumes reflect liquidity but not necessarily strength in fundamentals.
🎯 Entry Zone Recommendation: Current price of 14.9 ₹ is near its 52-week low of 12.4 ₹, reflecting weakness. A more attractive entry zone would be around 12–14 ₹, offering better risk-reward. Long-term investors should accumulate cautiously, given weak fundamentals but relatively low valuations.
Positive
- Low P/E (13.8) compared to industry average (25.6), suggesting undervaluation.
- Reasonable debt-to-equity ratio of 0.28.
- High trading volumes ensure liquidity.
- FII holdings increased by 0.17%, showing marginal foreign investor confidence.
Limitation
- Weak ROCE (10.2%) and ROE (6.83%) indicate poor efficiency.
- EPS of 1.08 ₹ is very low relative to market cap.
- Quarterly PAT decline from 278 Cr. to 182 Cr.
- No dividend yield, limiting shareholder returns.
Company Negative News
- Profit stagnation with negligible variation (-0.04%).
- DII holdings decreased by 0.16%, reflecting reduced domestic institutional confidence.
Company Positive News
- FII inflows (+0.17%) suggest marginal foreign support.
- Attractive valuations with P/B below 1.0.
- Liquidity supported by strong trading volumes.
Industry
- Power sector industry P/E at 25.6 reflects moderate valuations.
- Sector growth driven by infrastructure and renewable energy adoption.
- Government initiatives in clean energy support long-term expansion.
Conclusion
⚖️ JPPOWER is fundamentally weak with low return ratios and declining profits, but valuations appear attractive compared to peers. Investors may cautiously accumulate near 12–14 ₹ for better margin of safety. Long-term holding carries risk unless profitability improves significantly, though undervaluation and liquidity provide some speculative opportunity.
I can also compare JPPOWER’s valuation vs other mid-cap power producers to highlight relative strengths and weaknesses if you’d like.