Gujarat Poly Electronics Ltd is Rated Strong Sell

Current Rating and Its Significance

The Strong Sell rating assigned to Gujarat Poly Electronics Ltd indicates a cautious stance for investors, signalling that the stock is expected to underperform relative to the broader market and its peers. This rating is derived from a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. It suggests that investors should consider avoiding new positions or look to reduce exposure, given the prevailing risks and challenges faced by the company.

Here’s How the Stock Looks Today

As of 25 December 2025, Gujarat Poly Electronics Ltd remains a microcap player in the Other Electrical Equipment sector, with a Mojo Score of 17.0, reflecting a significant decline from its previous score of 33. The downgrade to Strong Sell on 06 Oct 2025 was driven by a 16-point drop in this score, underscoring deteriorating fundamentals and market sentiment.

Quality Assessment

The company’s quality grade is currently below average. Despite a compound annual growth rate (CAGR) of 18.33% in operating profits over the last five years, the firm struggles with weak long-term fundamental strength. Its ability to service debt is notably poor, with an average EBIT to interest coverage ratio of just 1.43, indicating limited cushion to meet interest obligations. This financial fragility raises concerns about the company’s operational resilience and sustainability.

Valuation Perspective

Gujarat Poly Electronics Ltd is considered expensive relative to its capital employed, with a return on capital employed (ROCE) of 6.6% and an enterprise value to capital employed ratio of 2.7. While the stock trades at a discount compared to its peers’ historical valuations, this valuation does not fully compensate for the risks highlighted by its weak profitability and cash flow metrics. The price-to-earnings-growth (PEG) ratio stands at a low 0.1, reflecting the market’s subdued expectations despite a near doubling (98.2%) of profits over the past year.

Financial Trend and Profitability

The financial grade for Gujarat Poly Electronics Ltd is flat, reflecting stagnation in key financial metrics. The latest quarterly results ending September 2025 reveal a sharp decline in profitability, with PAT falling by 62.3% to ₹0.42 crore compared to the previous four-quarter average. Operating cash flow for the year is negative at ₹-0.07 crore, and quarterly PBDIT is at a low ₹0.36 crore, signalling operational challenges and cash generation issues. Despite these setbacks, the company’s operating profits have grown at a CAGR of 18.33% over five years, indicating some underlying growth potential that has yet to translate into consistent profitability.

Technical Outlook

The technical grade is bearish, supported by the stock’s recent price performance. As of 25 December 2025, the stock has delivered negative returns across all key timeframes: a 1-day decline of 3.18%, 1-week drop of 8.06%, 1-month fall of 12.54%, and a 3-month slump of 34.55%. Over six months, the stock has lost 31.94%, and year-to-date returns stand at -35.59%. The one-year return is also deeply negative at -32.44%, significantly underperforming the BSE500 benchmark, which has gained 6.20% over the same period. This sustained downtrend reflects weak investor sentiment and technical pressure on the stock price.

Market Comparison and Investor Implications

Compared to its peers in the Other Electrical Equipment sector, Gujarat Poly Electronics Ltd’s valuation and returns profile is unfavourable. While the sector has seen moderate recovery and growth, this stock’s underperformance and financial challenges suggest heightened risk. Investors should weigh the company’s modest profit growth against its poor cash flow, weak debt servicing ability, and bearish technical signals before considering any exposure.

Summary for Investors

In summary, Gujarat Poly Electronics Ltd’s Strong Sell rating reflects a combination of below-average quality, expensive valuation relative to returns, flat financial trends, and bearish technical indicators. The company’s weak debt servicing capacity and negative cash flows add to the risk profile. Although there is some evidence of profit growth, the stock’s sustained underperformance against the broader market and peers suggests caution.

For investors, this rating serves as a signal to carefully evaluate the risks before initiating or maintaining positions in Gujarat Poly Electronics Ltd. The current market environment and company fundamentals do not favour a positive outlook, and the stock may continue to face downward pressure unless there is a significant improvement in operational performance and financial health.

Key Metrics at a Glance (As of 25 December 2025):

• Mojo Score: 17.0 (Strong Sell)


• Market Capitalisation: Microcap


• Operating Profit CAGR (5 years): 18.33%


• EBIT to Interest Coverage Ratio: 1.43 (Weak)


• ROCE: 6.6%


• Enterprise Value to Capital Employed: 2.7 (Expensive)


• PEG Ratio: 0.1


• Stock Returns: 1Y -32.44%, YTD -35.59%


• BSE500 Benchmark 1Y Return: +6.20%

Investors should continue to monitor quarterly results and market developments closely to reassess the company’s outlook and valuation dynamics.

Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year (MRP = Rs. 34,999) Start Today