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Check Before You Invest : Gretex Industries Ltd

BSE: 0 NSE: GRETEX ISIN: INE985P01012
  |   Sector:  Miscellaneous   |   Industry:  Trading

Snapshot

Q.1 Which industry/sub-sector does Gretex Industries Ltd belong to?
Gretex Industries Ltd belongs to the Miscellaneous sector, operating specifically within the Trading segment.
Q.2 Is Gretex Industries Ltd a good quality company?
Gretex Industries 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 Gretex Industries Ltd undervalued or overvalued?
Gretex Industries Ltd appears Overvalued, as its key valuation ratios are higher than 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 351.75 29.07
Price to Book 8.55 5.07
Price to Sales 8.74 1.13
EV to EBITDA 315.93 23.88
Q.4 Is Gretex Industries Ltd a good buy now?
Gretex Industries 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.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Gretex Industries Ltd?
Gretex Industries Ltd revenue growth is 5.8% for FY-2025, which is below its 5-year CAGR of 24.18%, indicating slower growth.

Q.2 Gross Profit margin of Gretex Industries Ltd?
Gretex Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 3.7% for FY-2025, which is in line with its 5-year median of 3.8%, indicating stable margins.

Q.3 Operating Profit Margin of Gretex Industries Ltd?
Gretex Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 1.48% for FY-2025, which is in line with its 5-year median of 1.48% indicating stable margins.

Q.4 Net Profit Margin of Gretex Industries Ltd?
Gretex Industries Ltd Net Profit Margin is 4.85% for FY-2025, is above its 5-year median of 4.12%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 3.7 3.8
Operating Profit Margin (%) 1.48 1.48
Net Profit Margin (%) 4.85 4.12

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Gretex Industries Ltd?
Gretex Industries Ltd Return on Asset is 4.63%, which is below its 5-year historical median of 8.38%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Gretex Industries Ltd?
Gretex Industries Ltd Return on capital employed is 5.73% for FY-2025, which is below its 5-year historical median of 9.71%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Gretex Industries Ltd?
Gretex Industries Ltd Return on equity is 6.54% for FY-2025, which is below its 5-year historical median of 14.35%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Gretex Industries Ltd?
Gretex Industries Ltd Cash conversion cycle is 95 days, above its 5-year historical median of 64 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.99 2.08
ROE (%) 6.54 14.35
ROCE (%) 5.73 9.71
Cash Conversion Cycle 95 days 64 days

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

Q.9 Debt to Equity ratio of Gretex Industries Ltd?
Gretex Industries Ltd Debt-to-Equity ratio is 0.39, which is above the industry average of 0.03, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Gretex Industries Ltd?
Gretex Industries Ltd Debt to cash flow from operations is -1.52, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Gretex Industries Ltd?

Q.1 Promoter shareholding and pledge status of Gretex Industries Ltd?
Promoters hold 64.95% of the Gretex Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Gretex Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Gretex Industries Ltd vs industry peers?
Gretex Industries Ltd revenue CAGR is 24.18%, compared to the industry median CAGR of 0%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 5.8 -
Gross Profit Growth (%) -92.3 17.9
Operating Profit Growth (%) 0 16.4
Net Profit Growth (%) -80 17.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.99 0.52
ROE (%) 6.54 2.05
ROCE (%) 5.73 3.6
Cash Conversion Cycle (days) 95.49 46

Valuation & price assessment

Q.1 Stock return of Gretex Industries Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 92.97% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- 93% 74.3% 28.4%
Q.2 Valuation ratios of Gretex Industries Ltd vs historical?
The current P/E ratio of 351.75 is higher than its historical median of 29.07, 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 351.75 29.07 33.62
Price to Book 8.55 5.07 1.57
Price to Sales 8.74 1.13 2.21
EV to EBITDA 315.93 23.88 14.09

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