Welcome to SensexBSE.com, recognized as the best stock analysis website in India. Our mission is to provide traders and investors with daily updates on market trends and educational insights. While we are not SEBI-registered, our content is designed to inform and assist in understanding market movements. Today’s feature focuses on Gravita India Ltd., a leader in the recycling and manufacturing sector, which has recently raised funds to fuel its expansion.
Key News and Updates
Gravita India Ltd. has announced a Qualified Institutions Placement (QIP) to raise ₹1,000 crore. The board has set the issue price at ₹2,096.20 per share, representing a 5% discount from the floor price of ₹2,206.49 as per SEBI regulations. Leading institutional investors like Oxbow Master Fund, Mirae Asset Mutual Fund, and Goldman Sachs have participated in this offering, reflecting strong confidence in the company’s future.
The raised funds will be directed toward:
- Debt reduction
- Optimizing working capital
- Expanding into lithium-ion and rubber recycling
- Exploring merger and acquisition opportunities
Gravita India is targeting a capacity of over 5 lakh metric tonnes per annum by FY27 with a ₹600 crore capex plan and is setting up a pilot project for lithium-ion battery recycling and a rubber recycling plant in Mundra.
Company Essentials
- Market Cap: ₹16,060.64 Cr.
- Enterprise Value: ₹16,324.16 Cr.
- No. of Shares: 6.90 Cr.
- P/E Ratio: 87.39
- P/B Ratio: 31.64
- Face Value: ₹2
- Dividend Yield: 0%
- Book Value (TTM): ₹73.54
- Cash: ₹2.11 Cr.
- Debt: ₹265.63 Cr.
- Promoter Holding: 63.37%
- EPS (TTM): ₹26.62
- Sales Growth: 6.13%
- ROE: 46.96%
- ROCE: 36.54%
- Profit Growth: 77.58%
Shareholding Pattern (Sep 2024 Quarter)
- Promoter Holding: 63.37% (Unchanged)
- FII/FPI Holdings: Increased from 13.40% to 14.01%
- FII/FPI Investors: Increased from 99 to 143
- Mutual Funds Holdings: Increased from 0.94% to 1.25%
- Institutional Investors Holdings: Increased from 16.01% to 17.22%
Strengths
- Profit Growth: Gravita India has demonstrated an impressive profit growth of 77.41% over the past 3 years, reflecting its solid financial performance.
- Revenue Growth: The company has achieved a 29.75% revenue growth over the last 3 years.
- ROE: Maintains a healthy ROE of 35.39% over the past 3 years, indicating efficient equity usage.
- ROCE: A robust ROCE of 26.85% over the last 3 years shows effective capital utilization.
- Cash Conversion Cycle: The company operates with an efficient Cash Conversion Cycle of 60.82 days, highlighting effective management of receivables, inventory, and payables.
Limitations
- Tax Rate: Gravita India has a relatively low tax rate of 13.74%, which might affect its overall profitability.
- High EV/EBITDA: The company is trading at a high EV/EBITDA of 64.33, suggesting that it may be relatively expensive compared to industry peers.
Stock Performance Analysis
Gravita India’s stock has shown impressive growth over the past year:
- A 130% increase, significantly outpacing the Nifty 50’s 15% growth.
After the QIP announcement, the stock faced some selling pressure, closing at ₹2,326.35, down 3.25% for the day.
Technical Insights
Key Technical Levels:
- Resistance: ₹2,400–₹2,450
- Support: ₹2,300 and ₹2,100 (QIP price level)
EMA Trend: The 9-day EMA is above the 15-day EMA, indicating a short-term bullish trend. However, declining volumes suggest potential consolidation in the short term.
Volume Analysis: Institutional activity remains robust, with a steady increase in volumes during key price movements, suggesting continued investor interest.
Important Disclaimer
This analysis is for educational purposes only and should not be considered financial or investment advice. SensexBSE.com is not SEBI-registered and does not provide specific stock recommendations or trading advice. We encourage readers to consult with a SEBI-registered advisor before making any investment decisions.
Trade Considerations
For Long-Term Investors: Gravita India’s focus on expanding into emerging recycling verticals presents substantial growth potential. Monitoring the stock around ₹2,100 could offer attractive long-term opportunities.
For Short-Term Traders:
- Bullish Setup: If the stock price moves above ₹2,400, watch for potential upward movement toward ₹2,500–₹2,600.
- Bearish Setup: If the price dips below ₹2,300, expect potential price movement toward ₹2,200.
Why Gravita India is Featured on the Best Stock Analysis Website in India
At SensexBSE.com, we strive to provide reliable and educational insights into top-performing Indian stocks. Gravita India’s financial strength, growth trajectory, and expansion plans make it a noteworthy company in today’s market analysis.
Conclusion
Gravita India’s recent fundraising and expansion plans highlight its growth prospects. While short-term volatility is expected, the company presents significant opportunities for both investors and traders. Stay tuned to SensexBSE.com for more daily insights and updates on India’s stock market.