Stock Performance and Market Context
The stock has been on a downward trajectory for the past three consecutive sessions, registering a cumulative loss of 3.57% over this period. Today’s decline of 1.98% notably underperformed the Power sector by 1.58%, reflecting persistent selling pressure. The share price now trades below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a sustained bearish trend.
In contrast, the broader market benchmark, the Sensex, experienced a negative session, falling by 277.70 points or 0.38% to close at 82,929.68. Despite this, the Sensex remains within 3.89% of its 52-week high of 86,159.02. The index has also recorded a three-week consecutive decline, losing 3.3% in this timeframe, with the 50-day moving average trading above the 200-day moving average, indicating mixed technical signals.
Long-Term Performance and Valuation Metrics
Over the last year, Gujarat Industries Power Co Ltd’s stock has underperformed significantly, delivering a negative return of 34.60%, compared to the Sensex’s positive 7.60% gain. The stock’s 52-week high was Rs.224, highlighting the extent of the recent decline.
Financially, the company’s long-term growth has been subdued. Net sales have contracted at an annual rate of 0.17% over the past five years, while operating profit has declined by 2.84% annually. Profitability pressures are evident in the latest quarterly results for September 2025, where the profit after tax (PAT) stood at Rs.21.30 crores, down 57.6% compared to the average of the previous four quarters.
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Profitability and Interest Coverage
The company’s operating profit to interest ratio has deteriorated, reaching a quarterly low of 5.93 times, while interest expenses rose to Rs.18.18 crores, the highest recorded in recent quarters. This increase in interest burden has contributed to the pressure on net profits and overall earnings quality.
Despite these challenges, Gujarat Industries Power maintains a relatively strong ability to service its debt, with a low Debt to EBITDA ratio of 0.88 times. The return on capital employed (ROCE) stands at 5%, indicating moderate efficiency in capital utilisation. The enterprise value to capital employed ratio is 0.7, suggesting a fair valuation relative to the company’s asset base.
Institutional Investor Activity
Institutional participation in the stock has declined, with a reduction of 0.8% in their holdings over the previous quarter. Currently, institutional investors hold 16.28% of the company’s shares. This decrease in institutional stake may reflect a reassessment of the company’s fundamentals by investors with greater analytical resources.
Comparative Market Performance
While the BSE500 index has generated a positive return of 6.26% over the past year, Gujarat Industries Power has lagged considerably, with a negative return of 34.60%. Profitability has also contracted, with profits falling by 12.8% during the same period. The stock trades at a premium relative to its peers’ historical valuations, which may be a factor in its subdued market performance.
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Mojo Score and Rating Update
Gujarat Industries Power Co Ltd currently holds a Mojo Score of 26.0, categorised as a Strong Sell. This rating was upgraded from Sell on 18 Aug 2025, reflecting the company’s deteriorating financial and market performance. The market capitalisation grade stands at 3, indicating a mid-tier valuation within its sector.
The stock’s recent price action and fundamental metrics underscore the challenges faced by the company in maintaining growth and profitability amid a competitive and evolving power sector landscape.
Summary of Key Financial Indicators
To summarise, the company’s key financial indicators reveal:
- Net sales growth at an annual rate of -0.17% over five years
- Operating profit decline of -2.84% annually over the same period
- Quarterly PAT decline of 57.6% to Rs.21.30 crores
- Interest expenses at a quarterly high of Rs.18.18 crores
- Debt to EBITDA ratio of 0.88 times, indicating manageable leverage
- ROCE at 5%, reflecting moderate capital efficiency
These figures provide a comprehensive view of the company’s current financial health and market standing.
Conclusion
The fall to a 52-week low of Rs.138.9 for Gujarat Industries Power Co Ltd highlights a period of subdued performance and valuation pressures. The stock’s underperformance relative to the broader market and sector, combined with declining profitability and reduced institutional interest, paints a cautious picture of the company’s recent trajectory. While the company maintains certain strengths such as debt servicing capacity, the overall financial and market indicators suggest ongoing challenges in regaining momentum.
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