Please refer to important disclosures at the end of this report
Gujarat Mineral Development Corporation Limited is the government of Gujarat
undertaking. The Company operates through two segments: Mining/Mineral and
Power. GMDC's core competency is the production and sale of lignite in Gujarat,
which accounts for around ~70% of the company's overall Sales.The Compan
has exclusive rights to mine lignite, bauxite and manganese in Gujarat which
result into Low-cost lignite operations. The company has a steady expansion
track record and healthy growing captive market in the state of Gujarat. This led
to a monopoly player for lignite in Gujarat. Moreover, as part of the move,
GMDC is also looking to strengthen its position as a value addition player in
minerals by setting up a `5,400cr alumina refinery in north Gujarat in a joint
venture with NALCO. Considering cyclical nature of its present business GMDC
is increasing power segment business aggressively. In near future, management
intent is to increase revenue of power segment from 30% to 40%. GMDC has
power purchase agreement (PPA) with Gujarat Urja Vikas Nigam Limited, the
state discom where it sells wind power at `4.15 per unit.
The GMDC is a good bet in the mining space, given its exclusive rights to mine
lignite, aggressive plan for power segment and healthy financial (average +15%
RoE for FY12-FY16, healthy operating cash flow, Debt free), Hence Buy.
CMP `114
Stock Info
Bloomberg Code [email protected]
Shareholding Pattern (%)
Promoters 74.0
MF / Banks / Indian Fls 12.3
FII / NRIs / OCBs 4.3
Indian Public / Others 9.4
Abs. (%) 3m 1yr 3yr
Sensex 7.6 22.0 39.0
GMDC 15.9 102.6 12.8
Metal & Mining
Market Cap (` cr) 3,633
Beta 1.0
52 Week High / Low 123/55
Avg. Daily Volume 136,617
Face Value (`)2
BSE Sensex 28,301
Nifty 8,778
Reuters Code GMDC.BO
Vaibhav Agrawal
022 – 3935 7800 Ext: 6808
Others | Metal & Mining
February 17, 2017
GMDC | Metal & Mining
February 17, 2017
Research Team Tel: 022 - 39357800 E-mail: [email protected] Website:
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Disclosure of Interest Statement GMDC
1. Financial interest of research analyst or Angel or his Associate or his relative No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives No
3. Served as an officer, director or employee of the company covered under Research No
4. Broking relationship with company covered under Research No
Ratings (Based on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
over 12 months investment
: Reduce
-5% to -15%
< -15