Gujarat Narmada Valley Fertilizers & Chemicals Limited

Basic Materials — Chemicals · NSE

₹566.00−₹6.15 (−1.07%)

DalalBaazaar Score

54 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Nothing obvious stands out as stretched — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

The 60-second version of Gujarat Narmada Valley Fertilizers & Chemicals Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Gujarat Narmada Valley Fertilizers & Chemicals Limited engages in the manufacturing and selling of fertilizers, industrial chemical products and providing IT services in India and internationally. It operates in two segments, Chemical and Fertilizers.

IndustryChemicals

SectorBasic Materials

Employees1,971

Annual revenue₹7,731 Cr

How does it make money?

Turns over ₹7,731 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹17 left at the operating level before interest, tax and depreciation. Each of its 1,971 employees supports ₹3.92 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.92 Cr

Who are its competitors?

The closest listed comparisons in its industry are PIDILITE INDUSTRIES LTD, SRF LTD, UPL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 10.4% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE15.4%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -24% while net margin moved -27% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect-24%

Margin effect-27%

DalalBaazaar Score

54/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 8.8% a year
✗ Profit has declined at 18.1% a year

Quality vs. Valuation

Company Quality

47/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

87/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

8.0x

3Y Median

12.1x

40 monthly readings · mean 12.0x · range 6.4x–21.1x

Sector Median

33.8x

median of 3 sector peers

🟢Current valuation is approximately 34% below its 3y median of 12.1x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 76% below the peer median of 33.8x.

vs. its own history

Cheap

12.1x median over 40 months · -34%

vs. sector peers

Cheap

33.8x median of 3 peers · -76%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

6.1x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.07x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 16.2% to 8.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 18.6% to 10.4% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 2 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 172% over 3 years, from ₹2 Cr to ₹5 Cr.
🔴Receivables growing faster than salesFinancial
Receivables up 74% against revenue up -24% — sales are being booked faster than they are collected.
🟡Profit is decliningFinancial
Net profit is down 45% over 3 years.
🟡Margins are compressingFinancial
EBITDA margin is down 4.5 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 34% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 76% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹108 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 22.0% to 17.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 74% against revenue up -24%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 16.2% to 8.9%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Small Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 15%✓ 17.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹108 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 8%✓ 10.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 12.1x✓ 8.0x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

9 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

8 good · 3 neutral · 0 weak

Market Cap

₹8,317 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

8.0x

Cheap

Cheap against the generic band

P/B Ratio

0.91x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹70.54

Profitable

Profitable on a per-share basis

ROE

8.9%

Moderate

Moderate capital efficiency

ROCE

10.4%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.07x

Low

Conservative leverage

Revenue Growth (YoY)

39.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

275.6%

Healthy

Profits growing at a healthy clip

Dividend Yield

3.71%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹108 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

9.0x

Flat

At or above the trailing multiple — no earnings uplift is being priced in

Operating Margin

14.2%

Average

Average margins

Net Margin

12.3%

Good

Strong bottom-line conversion

Current Ratio

5.91

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.29

Defensive

Steadier than the market

52W Range Position

74%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

599.8 / 584.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

28.7

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹10,207 Cr	₹7,895 Cr	₹7,858 Cr	₹7,731 Cr	-8.8%
EBITDA	₹2,245 Cr	₹986 Cr	₹1,108 Cr	₹1,353 Cr	-15.5%
EBITDA Margin	22.0%	12.5%	14.1%	17.5%	—
PAT (Net Profit)	₹1,472 Cr	₹497 Cr	₹598 Cr	₹809 Cr	-18.1%
EPS	₹94.68	₹32.47	₹40.68	₹55.03	-16.5%
ROE	16.2%	6.0%	7.0%	8.9%	—
ROCE	18.6%	6.9%	8.2%	10.4%	—
Total Debt	₹2 Cr	₹3 Cr	₹106 Cr	₹5 Cr	+39.6%
Free Cash Flow	₹1,200 Cr	-₹220 Cr	₹152 Cr	₹108 Cr	-55.2%

🔴 Revenue has shrunk at 8.8% a year over 3 years.

🔴 EBITDA has shrunk at 15.5% a year over 3 years.

🔴 EBITDA Margin has fallen from 22.0% to 17.5% over 3 years (-4.5 pts).

🔴 PAT (Net Profit) has shrunk at 18.1% a year over 3 years.

🔴 EPS has shrunk at 16.5% a year over 3 years.

🔴 ROE has fallen from 16.2% to 8.9% over 3 years (-7.3 pts).

🔴 ROCE has fallen from 18.6% to 10.4% over 3 years (-8.2 pts).

🔴 Total Debt has grown at 39.6% a year over 3 years.

🔴 Free Cash Flow has shrunk at 55.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹11,359 Cr

Total Liabilities

₹2,244 Cr

Cash & Equivalents

₹74 Cr

Operating Cash Flow

₹654 Cr

Capex

-₹546 Cr

Shareholding (proxy)

Institutional Holding

15.4%

Insider Holding

43.5%

Corporate Actions

Dividend Rate

₹21

Ex-Dividend Date

09 Sept 2026

Peer Comparison

Company	P/E	ROE
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

1 positive3 mixed2 general

GNFC Shares Edge Lower: Gujarat Narmada Valley Fertilizers Slips 1.28% to ₹571.25 - Modified Schiff

https://www.siam.in/, 15 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

GNFC Share Price Rises 7.19% Today

Univest, 06 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Gujarat Narmada Valley Fertilizers & Chemicals Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

Income Investors Should Know That Gujarat Narmada Valley Fertilizers & Chemicals Limited (NSE:GNFC) Goes Ex-Dividend Soon

Simply Wall Street, 05 SeptCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Over 55% returns in 6 months! Ventura sees 29% more upside in the short term | Technical outlook with target, stoploss

Livemint, 25 Sept

Gujarat Narmada Valley Fertilizers Shares Fall 6% in Today’s Trading Session; Here’s Why By Trade Brains

Investing.com India, 09 MarPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability · Risk

WeakGrowth

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑