Godawari Power Gets 'Add' Upgrade From Yes Securities — Check Revised Target Price And More

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Yes Securities Report

Given Godawari Power and Ispat Ltd.'s improving visibility on volumes, earnings growth, and the benefits of the mining expansion, Yes Securities revises its valuation multiple upwards to seven times FY28E enterprise value/Ebitda (earlier 6.5x) and arrive at a revised target price of Rs 277/share (earlier Rs 261/share).

Accordingly, upgrade rating on the stock to ‘Add’.

Valuation and view

Godawari Power might face near-term headwinds amid weak steel pricing across the long-products value chain. Nonetheless, signs of recovery in long steel realizations, coupled with the expected seasonal pickup in construction demand in Q4 FY26E, should support an operational rebound.

Godawari Power’s integrated model remains structurally sound, and once ECs are secured, the margin compression from elevated input costs is expected to reverse meaningfully.

From FY27E onwards, Godawari Power is well-positioned to enter a phase of sharp earnings improvement. The company will begin reaping the full benefits of backward integration from H2 FY27E as the expanded Ari Dongri mining operations go live, reducing external ore dependency.

Additionally, the ramp-up of its new 2.0 mtpa pellet plant will provide a strong volume catalyst, driving total pellet capacity to ~4.7 mtpa.

With improved raw material security, higher throughput, and operating leverage benefits, the brokerage expects a robust recovery in the company’s margin profile over FY27–28E, setting the stage for a structural earnings re-rating.

Yes Securities expects Ebitda to grow at a CAGR of 27.3% during FY25-28E, owing to the above-mentioned reasons.

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