GK Energy (GKENERGY)

FairStock Score: 55/100 — STEADY

Score breakdown: P/E: 2/3 · ROCE: 2/2 · Growth: 2/2 · Dividend: 0/1

Key Financials

Strengths

• Profit growth of 57.72% and sales growth of 43.64% with a PEG of 0.24 indicate attractive growth relative to valuation
• Very high ROCE of 74.29% points to efficient capital deployment
• Piotroski F-Score of 7/9 suggests solid financial fundamentals
• Promoter holding of 79.20% aligns management interest with minority shareholders
• Reasonable P/E of 12.17 for a company growing at this pace

Concerns

• Zero dividend yield means no cash return to shareholders; all profits are being retained
• Price-to-book of 3.39 with book value of just ₹38.41 implies a rich premium over tangible net worth
• Civil construction is cyclical and the wide 52-week range of ₹87.20 to ₹239.60 signals high volatility and sentiment risk
• ROE is not stated, so the true return on equity and durability of profitability remain uncertain

AI Analysis

Looking at GKENERGY, I see a business that Graham would call reasonably priced for what it delivers, but I must be careful with construction. The arithmetic is attractive: 12.17 times earnings, with profit growing 57.72% and sales up 43.64%. That gives a PEG near 0.24, far below my threshold. ROCE of 74.29% also stands out, though ROE is not provided and I never invest on one ratio alone. The balance sheet shows debt-equity of 0.54, acceptable for a civil contractor, and a Piotroski score of 7 out of 9 suggests financial health is sound. Promoter holding of 79.20% aligns owners with public shareholders, which I value. However, the zero dividend yield reminds me that every rupee is being retained, and for a capital-intensive construction firm I want to see that capital converted into consistent returns. The stock trades at 3.39 times book value, and with book value of only ₹38.41, I am paying a substantial premium over tangible assets. The 52-week range of ₹87.20 to ₹239.60 also tells me this is a volatile, sentiment-driven sector. In civil construction, tomorrow's margin is not guaranteed by today's order book. The latest quarter's ₹460 crore sales and ₹59 crore profit are good, but I would want several more quarters before calling it durable. At 12.17 times earnings with this growth, it appears to be a fast grower at a reasonable price, not a wonderful business I can hold forever without watching it closely.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer