JPPOWER - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.1

📊 Core Financials & Profitability

Profit Growth: PAT surged from ₹155 Cr to ₹278 Cr QoQ, though the reported quarterly variation is -20.2%, likely due to one-time adjustments or seasonality.

Return Metrics

ROE: 6.83% and ROCE: 10.2% — modest but improving.

EPS: ₹1.08 — reasonable for a ₹18.8 stock, indicating fair earnings power.

Debt Profile: Debt-to-equity at 0.31 — impressively low for a capital-intensive power business.

Dividend Yield: 0.00% — no payouts, but reinvestment may support future growth.

💸 Valuation Indicators

Metric Value Insight

P/E Ratio 17.4 Below industry PE of 31.2 — undervalued.

P/B Ratio ~1.05 Fairly valued relative to book value ₹17.9.

PEG Ratio 0.18 Very attractive — suggests strong growth potential at a low valuation.

🔍 Conclusion: JP Power is undervalued based on earnings and growth metrics. PEG ratio and P/E suggest room for upside.

⚡ Business Model & Competitive Edge

Core Operations: JP Power operates thermal and hydro power plants with a total capacity of 2,200 MW, plus coal mining and cement grinding units

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Strategic Catalyst: Vedanta won a ₹17,000 Cr bid for Jaiprakash Associates assets, beating Adani Group — a major restructuring trigger

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Growth Outlook

Forecasted 1-year target: ₹23.3

5-year target: ₹39.8

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Historical returns: 611% over 5 years, 102% over 2 years

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📉 Technicals & Entry Zone

RSI: 47.0 — neutral, no strong momentum.

MACD: -0.11 — mild bearish signal.

DMA Levels: Price hovering near 50-DMA and 200-DMA — consolidation zone.

📌 Suggested Entry Zone: ₹17.5–₹18.5 — near 200-DMA, offering a low-risk entry.

🕰️ Long-Term Holding Guidance

Hold if Invested: Strong upside potential and undervaluation support long-term holding.

Buy on Dips: Especially if price nears ₹17 or RSI dips below 40.

Monitor: Asset restructuring, coal mine output, and regulatory approvals.

If you'd like a forecast model for 2030 or a comparison with Adani Power and Tata Power, I can build that next.

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