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Check Before You Invest : CG Power and Industrial Solutions Ltd

BSE: 500093 NSE: CGPOWER ISIN: INE067A01029
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Electric Equipment

Snapshot

Q.1 Which industry/sub-sector does CG Power and Industrial Solutions Ltd belong to?
CG Power and Industrial Solutions Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Electric Equipment segment.
Q.2 Is CG Power and Industrial Solutions Ltd a good quality company?
CG Power and Industrial Solutions Ltd is a average quality company, based on a somewhat consistent 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 CG Power and Industrial Solutions Ltd undervalued or overvalued?
CG Power and Industrial Solutions Ltd appears Somewhat 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 112.94 63.00
Price to Book 17.09 27.49
Price to Sales 10.97 9.41
EV to EBITDA 72.32 62.76
Q.4 Is CG Power and Industrial Solutions Ltd a good buy now?
CG Power and Industrial Solutions 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 CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd revenue growth is 23.2% for FY-2025, which is above its 5-year CAGR of 14.16%, indicating faster growth.

Q.2 Gross Profit margin of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Gross profit margin which is the profit after deduction of direct costs, is 14.6% for FY-2025, which is in line with its 5-year median of 14.6%, indicating stable margins.

Q.3 Operating Profit Margin of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.31% for FY-2025, which is in line with its 5-year median of 13.31% indicating stable margins.

Q.4 Net Profit Margin of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Net Profit Margin is 9.82% for FY-2025, is below its 5-year median of 11.42%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 14.6 14.6
Operating Profit Margin (%) 13.31 13.31
Net Profit Margin (%) 9.82 11.42

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Return on Asset is 15.11%, which is below its 5-year historical median of 17.95%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Return on capital employed is 39.9% for FY-2025, which is below its 5-year historical median of 60.94%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.7 Return on Equity (ROE) of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Return on equity is 28.59% for FY-2025, which is below its 5-year historical median of 36.44%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Cash conversion cycle is 42 days, above its 5-year historical median of 27 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) 1.56 1.56
ROE (%) 28.59 36.44
ROCE (%) 39.9 60.94
Cash Conversion Cycle 42 days 27 days

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

Q.9 Debt to Equity ratio of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.29, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of CG Power and Industrial Solutions Ltd?
CG Power and Industrial Solutions Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of CG Power and Industrial Solutions Ltd?

Q.1 Promoter shareholding and pledge status of CG Power and Industrial Solutions Ltd?
Promoters hold 56.36% of the CG Power and Industrial Solutions Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does CG Power and Industrial Solutions Ltd performance compare with that of its Peers?

Q.1 Revenue growth of CG Power and Industrial Solutions Ltd vs industry peers?
CG Power and Industrial Solutions Ltd revenue CAGR is 14.16%, compared to the industry median CAGR of 11.85%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 23.2 11.9
Gross Profit Growth (%) 18.5 30
Operating Profit Growth (%) 15.5 49.9
Net Profit Growth (%) 11.7 33.8
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.56 1.03
ROE (%) 28.59 22.83
ROCE (%) 39.9 30.68
Cash Conversion Cycle (days) 42.21 23

Valuation & price assessment

Q.1 Stock return of CG Power and Industrial Solutions Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 30.3% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
30.3% 57.9% 34.9% 24.3%
Q.2 Valuation ratios of CG Power and Industrial Solutions Ltd vs historical?
The current P/E ratio of 112.94 is higher than its historical median of 63.00, 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 112.94 63.00 38.08
Price to Book 17.09 27.49 3.97
Price to Sales 10.97 9.41 2.75
EV to EBITDA 72.32 62.76 18.75

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