GPIL - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

📊 Investment Analysis: Godawari Power & Ispat Ltd. (GPIL)

Investment Rating: 3.7

🔧 Long-Term Investment Outlook

GPIL comes across as a financially sound, mid-cap metal player with attractive return ratios and low leverage. However, growth momentum has recently plateaued, and valuation metrics require close attention.

✅ Strengths

ROCE: 23.3% | ROE: 17.3% — Strong efficiency and profitability.

Debt-to-Equity: 0.06 — Virtually debt-free, reinforcing stability.

P/E: 16.0 vs Industry PE: 23.8 — Undervalued on a relative basis.

EPS: ₹12.1 — Decent earnings generation.

Technical Support near ₹187–₹188 — Price close to DMA 50/200, suggests base-building zone.

⚠️ Concerns

PEG Ratio: -0.97 — Implies earnings contraction despite low P/E.

Dividend Yield: 0.52% — Limited income contribution.

Quarterly PAT Growth: 1.24% — Stagnating profit growth.

52W Index: 45.0% — Trading closer to 52-week lows.

FII Holding ↓ (-0.07%) — Slight foreign exit trend.

RSI: 58.7 | MACD: 1.61 — Neutral momentum; no strong bullish or bearish signals.

🎯 Ideal Entry Price Zone

₹175–₹185

Offers safety near moving average support and more valuation comfort.

A PEG recovery or clear volume buildup would make this range optimal.

🧭 Strategy for Existing Holders

⏳ Holding Period

12–18 Months

Suitable for patient investors seeking turnaround in operating metrics or cyclical tailwinds in commodities.

🚪 Exit Strategy

Exit Zone: ₹230–₹250

Exit Triggers

ROE falls below 14% and earnings continue to stagnate.

PEG ratio remains negative for 2+ quarters.

Price dips below ₹175 accompanied by volume spike and bearish MACD crossover.

Continued FII reduction paired with RSI drop below 45.

🧠 Final Thought

GPIL feels like a low-debt undervalued metal pick caught in a consolidation zone. It’s not lighting up the scoreboard for growth just yet, but it’s holding its ground with financial strength. If you’re holding, stay alert to margin trends and institutional flows. If you're scouting an entry, wait for technical confirmation near support.

Want me to pull up a comparative view with Jindal Steel or Tata Metaliks to help evaluate sector momentum?

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