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RATING

RECOMMENDATION

Sell

Business Type

Traditional Business

  • GG Automotive Growth


GG Automotive Revenue Growth

Growth in %

  • -46.26%

    1 Year

  • -10.63%

    3 Year

  • 6.85%

    5 Year

The revenue of the company has been impacted due to COVID-19 restrictions, which led to closure of plant and hence reducing the aggregate revenue of the company. In FY21, gross profit margin has taken a hit, due to rise in the price of raw materials procurement, thus to improve the demand, the products are sold at discounted price leading to fall in the revenue of the company altogether. In FY20, despite stable revenue, net profit of the company has taken a hit on the account of considerable amount of material remained in inventory due to world wide pandemic situation which resulted in lower profit for FY20. 


GG Automotive Net Profit Growth(PAT)

Growth in %

  • NA

    1 Year

  • NA

    3 Year

  • NA

    5 Year

The company has suffered losses in FY21, primarily due to fall in the revenue and poor inventory management. The company has made efforts at reducing their tax expenses. With COVID-19 restrictions, the company were not able to conduct any offline expos and exhibitions, which in turn reduces the opportunity to sell products at premium, reducing the price of goods sold and with fixed assets expenses, the company suffered losses in FY21.

GG Automotive EPS Growth

Growth in %

  • NA

    1 Year

  • NA

    3 Year

  • NA

    5 Year

The EPS of the company has taken hit, due to losses faced by the company in FY21. EPS has fallen by a factor of 1.4x from FY20.

  • GG Automotive Book Value Growth

Growth in %

  • -1.68%

    1 Year

  • 9.86%

    3 Year

  • 10.01%

    4 Year

With company incurring losses in FY21, resultantly has reduced the retained earning of the company in the other equity part in the balance sheet and security premium reserves, other comprehensive income constant, other equity fell by 17%, reducing the book value of the company by 1.7%. It must be noted that there were no changes made in the number of shares.

GG Automotive EBITDA Growth

Growth in %

  • -75.11%

    1 Year

  • -34.87%

    3 Year

  • -0.36%

    5 Year

The EBITDA of the company has fallen dramatically by 75%, manufacturing expenses and office and administration expenses were low as compared to FY20 in FY21. Due to fewer sales promotion expenses, which fell by 67%, reduced the marketability of the products and hence lower revenue, which eventually was the main reason for this decline.  

GG Automotive Operating Profit Growth

Growth in %

  • NA

    1 Year

  • NA

    3 Year

  • NA

    5 Year

The company is an auto ancillary manufacturing company and, with almost the same level of fixed assets as in FY20, the depreciation expense of the company has been the same as in FY20. With an EBITDA of Rs. 221 lakhs and a depreciation worth Rs. 308 lakhs in FY21, the EBIT of the company turned negative. 

GG Automotive Asset Growth

Growth in %

  • -18.02%

    1 Year

  • -1.67%

    3 Year

  • 14.04%

    5 Year

The company did not make any significant changes to its assets. With operational curbs due to COVID-19 restrictions, the company's current assets fell by 38% on account of low receivables and inventories in FY21, which both accounted for 71% of the change in the current liabilities of the company. Non-current assets, on the other hand, increased by 3%, owing to the mature business stage and the impact of COVID-19.

GG Automotive Cash Flow from Operations

Growth in %

  • -75.66%

    1 Year

  • -22.35%

    3 Year

  • -0.30%

    5 Year

In comparison to FY20, cash flow from operations decreased by 76% in FY21. The negative profit before taxes is the fundamental cause of the decline. The company has dramatically reduced its current assets, but with far fewer payable in FY21 than in FY20, which is a positive indicator, but it has also significantly lowered its cash flow from operations.

  • GG Automotive Solvency Ratios

GG Automotive D/E Ratio

Total debt/equity ratio of the company has shown a marginal rise primarily on account of higher long-term borrowings. The company’s borrowing facilities comprising term loans and loans from director, which rose by 16% from FY20 in FY21. On the other hand, equity of the company fell down by 11% increasing the debt/equity of the company. 

GG Automotive Current Ratio

The current ratio of the company has witnessed a marginal decline of 2%. The decrease in current ratio of 38% is primarily due to a 43% decrease in the receivables of the company and a 43% decrease in current liabilities, owing primarily to a 72% decrease in trade payable.With this fall in both the current assets and current liabilities, the current ratio fell by 2% in FY21.

GG Automotive Quick Ratio


GG Automotive Interest Coverage Ratio

The interest expenses of the company declined by 27% in FY21 from FY20, despite the higher total debt, because in FY21 the company raised debt through term loans, which had a higher interest expense in FY21 than in FY20. The company also raised short-term borrowing in FY21, which was far less than in FY20. Aggregately, this has reduced the interest expense in FY21. Despite lower interest expenses, interest coverage fell because of negative EBIT.

  • GG Automotive Operating Efficiency

In FY21, all the operating margins has witness fall. This fall has been accredited to fall in the marketing and lower revenue generation in FY21, which was due to curbs in the operation along with low inventory turnover ratio. 

GG Automotive Operating Profit EBIT Margin(OPM)

GG Automotive Profit Before Tax Margin (PBT Margin)

GG Automotive Profit After Tax Margin (PAT Margin)

  • GG Automotive Profitablity Ratio

In FY21, the company has suffered loss of Rs. 246 lakhs, which evidently led to decline in all the profitability ratios of the company altogether.

GG Automotive Return on Equity(RoE)

The return on equity fell by a factor of 144x from FY20 in FY21. As per dupont analysis, this de-growth has been brought about by a fall in the net income margin by 365%. On the other hand, asset turnover fell by 42% on account of poor asset management, which was a result of COVID-19 restrictions. The equity multiplier has been least impacted, falling by 6% from FY20 in FY21.

GG Automotive Return on Capital Employed(RoCE)

The capital employed in the firm grew by 8% in FY21 from FY20, which was due to an 89% growth in the long-term debt of the company, as the company had taken 3 term loans from the bank in FY21. On the other hand, EBIT was negative in FY21 by the amount of Rs. 88 lakhs. aggregately, accounting for a fall in the ROCE of 155% in FY21 from FY20. 

GG Automotive Return to Assets (RoA)

The company was not able to fully utilise its resources in FY21, which evidently lead to lower return on assets from FY20. It must be noted that aggregately total assets witnessed the de-growth of 7% in FY21 from FY20 as fewer purchases of fixed assets were made in FY21. 

  • GG Automotive Valuation Ratios

GG Automotive Earning Yield