Gujarat Gas (GUJGASLTD)

FairStock Score: 61/100 — STEADY

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

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I’m wearing Graham’s glasses and Buffett’s patience here. Gujarat Gas is a large, ₹30,685 Cr city-gas distributor, and the basic business quality is visible: ROCE of 19.50%, ROE of 12.27%, sales growth of 21.10%, profit growth of 32.60%, and a five-year revenue CAGR of 9.87%. The latest quarter showed ₹3,658 Cr of sales and ₹267 Cr of net profit. Promoter holding of 60.89% is a positive alignment signal, and a 1.43% dividend yield offers some cash return. At ₹327.05, it trades at 1.66 times book value of ₹196.86, which is not demanding against book, and its Piotroski F-Score of 6/9 suggests a reasonably steady financial position. But the stated P/E of 961.91 is the elephant in the room. Even if I take the latest quarter’s ₹267 Cr profit and annualise it, the earnings multiple would be far lower, so the given P/E and PEG of 1.16 do not sit comfortably together. A value investor must resolve that before paying up. Meanwhile, free cash flow is negative at ₹-115 Cr, and debt/equity of 1.19 means the balance sheet is not pristine. Growth is impressive, but a gas distributor needs capital to expand; negative FCF plus leverage can squeeze returns if growth slows. The 52-week range of ₹301.50–₹443.75 shows the stock has already corrected, but that alone is not a margin of safety. My verdict: this looks more like a Stalwart than a fast-growing bargain. The moat from city-gas infrastructure and promoter backing is real, but the current numbers demand that I monitor cash generation, leverage, and the true earnings base. I would not chase; I would wait for clarity and a better price.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

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