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Check Before You Invest : Gopal Snacks Ltd

BSE: 544140 NSE: GOPAL ISIN: INE0L9R01028
  |   Sector:  FMCG   |   Industry:  Consumer Food

Snapshot

Q.1 Which industry/sub-sector does Gopal Snacks Ltd belong to?
Gopal Snacks Ltd belongs to the FMCG sector, operating specifically within the Consumer Food segment.
Q.2 Is Gopal Snacks Ltd a good quality company?
Gopal Snacks Ltd is a weak quality company, based on a inconsistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Gopal Snacks Ltd undervalued or overvalued?
Gopal Snacks Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 989.31 42.75
Price to Book 9.24 9.91
Price to Sales 2.95 2.94
EV to EBITDA 56.74 30.99
Q.4 Is Gopal Snacks Ltd a good buy now?
Gopal Snacks Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

Q.1 Gross Profit margin of Gopal Snacks Ltd?
Gopal Snacks Ltd Gross profit margin which is the profit after deduction of direct costs, is 7.3% for FY-2025, which is in line with its 5-year median of 7.3%, indicating stable margins.

Q.2 Operating Profit Margin of Gopal Snacks Ltd?
Gopal Snacks Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 7.17% for FY-2025, which is in line with its 5-year median of 7.17% indicating stable margins.

Q.3 Net Profit Margin of Gopal Snacks Ltd?
Gopal Snacks Ltd Net Profit Margin is 1.29% for FY-2025, is below its 5-year median of 3.07%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 7.3 7.3
Operating Profit Margin (%) 7.17 7.17
Net Profit Margin (%) 1.29 3.07

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Gopal Snacks Ltd?
Gopal Snacks Ltd Return on Asset is 3.53%, which is below its 5-year historical median of 11.2%, indicating deteriorated asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Gopal Snacks Ltd?
Gopal Snacks Ltd Return on capital employed is 6.55% for FY-2025, which is below its 5-year historical median of 22.05%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.6 Return on Equity (ROE) of Gopal Snacks Ltd?
Gopal Snacks Ltd Return on equity is 4.78% for FY-2025, which is below its 5-year historical median of 26.51%, indicating the business is making worse use of its shareholders capital.

C: How much debt does the business have and is it at a sustainable level?

Q.7 Debt to Equity ratio of Gopal Snacks Ltd?
Gopal Snacks Ltd Debt-to-Equity ratio is 0.16, which is lower the industry average of 0.49, indicating lower debt levels in the industry.

Q.8 Debt to cash flow from operations of Gopal Snacks Ltd?
Gopal Snacks Ltd Debt to cash flow from operations is 0.97, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Gopal Snacks Ltd?

Q.1 Promoter shareholding and pledge status of Gopal Snacks Ltd?
Promoters hold 81.46% of the Gopal Snacks Ltd, with 11.94% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Gopal Snacks Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Gopal Snacks Ltd vs industry peers?
Gopal Snacks Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 6.98%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) - 7
Gross Profit Growth (%) -36.3 13.3
Operating Profit Growth (%) -37.5 12.6
Net Profit Growth (%) -81 20.7
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 2.73 1.2
ROE (%) 4.78 7.22
ROCE (%) 6.55 11.34
Cash Conversion Cycle (days) 46.6 48

Valuation & price assessment

Q.1 Stock return of Gopal Snacks Ltd over the last decade?
Over the last 1 year(s), the stock has delivered a CAGR of 23% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - 23%
Q.2 Valuation ratios of Gopal Snacks Ltd vs historical?
The current P/E ratio of 989.31 is higher than its historical median of 42.75, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 989.31 42.75 26.55
Price to Book 9.24 9.91 2.53
Price to Sales 2.95 2.94 1.43
EV to EBITDA 56.74 30.99 14.38

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