Godawari Power - Ticking All The Right Boxes; Yes Securities Initiates Coverage With A Buy

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Yes Securities Report.We initiate coverage on Godawari Power and Ispat Ltd. with a bullish Buy rating. Our rating on Godawari Power is built on the following conviction:Backward integration ensures cost optimisation to be at the heart of operationsGodawari Power’s financial performance has been highly dependent on its backward integration operations. The ongoing expansion of the mining operations is central to the company's plans for future investments in capital assets..High-grade pelletisation propels future growthGodawari Power is currently undergoing an expansion on its pellet plants from 2.70 mtpa to 4.70 mtpa of capacity. Godawari Power adopted high-grade pellets instead of iron ore lumps and blended coal in its sponge iron manufacturing process. These high-quality pellets command a premium over the market prices of standard-grade pellets, in the range of approximately Rs 1,000 to Rs 1,500 per tonne..Healthy balance sheet is a compelling value propBeing a net-debt free company allows Godawari Power to allocate new funds for growth projects from internal profits. The reduced interest costs will lead to increased liquidity for the business, enabling it to undertake major capital investments. More importantly, the company’s stock has been trading below its peers over the years due to the debt burden attached to the company’s operations..HRC plant paves the way for strong industry and market footholdFollowing its expansions in the mining and pelletization activities, Godawari Power will be strategically positioning itself to advance forward by aiming to become an integrated steel producer. The first step in this direction is the development of the 2.0 mtpa integrated HRC plant. The project is anticipated to be finished between September 2027 and March 2028. We believe that by establishing this HRC plant, Godawari Power will be able to fully utilize its backward integrated capabilities to enhance its market position as one of the most cost-effective steel producers in the country..Click on the attachment to read the full report:.Jubilant FoodWorks - On The Verge Of A Turnaround: HDFC Securities.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Godawari Power - Ticking All The Right Boxes; Yes Securities Initiates Coverage With A Buy

Values Godawari Power at 6.5 times FY26E enterprise value/Ebitda to arrive at our target price of Rs 1,390 /share

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