Understanding the Current Rating
The 'Hold' rating assigned to Gujarat Ambuja Exports Ltd indicates a neutral stance for investors. It suggests that while the stock may not be an immediate buy opportunity, it is also not a sell candidate at present. This rating reflects a balance of strengths and weaknesses across key parameters that influence the company’s investment appeal.
Quality Assessment
As of 01 February 2026, Gujarat Ambuja Exports Ltd holds an average quality grade. The company maintains a low debt-to-equity ratio, effectively zero, which is a positive indicator of financial prudence and limited leverage risk. However, the long-term growth outlook remains subdued, with operating profit declining at an annualised rate of -3.20% over the past five years. The latest half-yearly results show a 23.66% decrease in profit after tax (PAT), standing at ₹107.42 crores, and a return on capital employed (ROCE) of 9.07%, which is relatively low. These factors temper the overall quality assessment, signalling challenges in sustaining robust profitability and growth momentum.
Valuation Considerations
The valuation grade for Gujarat Ambuja Exports Ltd is classified as very expensive. The stock trades at a price-to-book value of 2.1, which is a premium compared to its peers and historical averages. Despite this premium valuation, the company’s return on equity (ROE) is modest at 6.7%, raising questions about the justification for the elevated price multiples. Over the past year, the stock has delivered a total return of 15.35%, outperforming some peers, yet this has come alongside a 39% decline in profits, highlighting a disconnect between market pricing and earnings performance. Investors should be cautious about the high valuation relative to the company’s current earnings power.
Financial Trend Analysis
The financial trend for Gujarat Ambuja Exports Ltd is flat, reflecting a lack of significant improvement or deterioration in recent periods. The company’s non-operating income constitutes 34.86% of profit before tax, indicating a substantial contribution from sources outside core operations. This reliance on non-operating income may introduce volatility and reduce the predictability of earnings. Additionally, the flat results reported in December 2025 reinforce the view that the company is currently experiencing limited growth and profitability expansion.
Technical Outlook
From a technical perspective, the stock exhibits a bullish grade. Despite a one-day decline of 5.92% and a one-week drop of 2.39%, the stock has shown resilience with a three-month gain of 25.68% and a six-month increase of 20.05%. Year-to-date, the stock is down 3.70%, but the one-year return remains positive at 15.35%. This technical strength suggests that market sentiment remains relatively favourable, potentially supported by broader sector trends or investor interest in the company’s market position.
Sector and Market Position
Gujarat Ambuja Exports Ltd is the largest company in the Other Agricultural Products sector, with a market capitalisation of approximately ₹6,389 crores. It accounts for 30.31% of the sector’s market cap and generates annual sales of ₹5,175.42 crores, representing nearly 15% of the industry’s total. Despite its size, domestic mutual funds hold a modest 0.54% stake, which may reflect cautious sentiment among institutional investors regarding the company’s valuation or business prospects.
Implications for Investors
The 'Hold' rating signals that investors should maintain their current positions without adding significant new exposure or selling off holdings aggressively. The company’s strong market position and technical momentum offer some support, but the expensive valuation and flat financial trends warrant a cautious approach. Investors seeking growth or value opportunities may prefer to monitor the company for signs of improved profitability or valuation correction before committing additional capital.
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Summary of Key Metrics as of 01 February 2026
The latest data shows the stock’s one-day decline at -5.92%, with a one-month dip of -1.12%, but a strong three-month gain of +25.68%. Over six months, the stock has appreciated by +20.05%, and the one-year return stands at +15.35%. The company’s financials reveal a flat trend with a PAT decline of -23.66% in the latest half-year and a ROCE of 9.07%. The valuation remains stretched with a price-to-book ratio of 2.1 and a modest ROE of 6.7%. These figures collectively underpin the current 'Hold' rating.
Conclusion
Gujarat Ambuja Exports Ltd’s current 'Hold' rating by MarketsMOJO reflects a nuanced investment case. The company’s strong market presence and positive technical signals are balanced by expensive valuation and subdued financial growth. Investors should consider these factors carefully, recognising that the stock may be suitable for those seeking stability rather than aggressive growth. Monitoring future earnings trends and valuation shifts will be essential to reassessing the stock’s attractiveness over time.
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