Gujarat Mineral Development Corporation Ltd (GMDC) – Stock Analysis
The mining sector in India has some strong players like NMDC Stock Analysis 2025 and MOIL Stock Review. In this post, we present a detailed analysis of Gujarat Mineral Development Corporation (GMDC), covering its share price, fundamentals, and valuation.
Company Overview
Gujarat Mineral Development Corporation Ltd. (GMDC), a state-owned enterprise established in 1963, is primarily engaged in mining and power generation. The company operates across multiple mineral segments, including lignite, bauxite, fluorspar, manganese, silica sand, limestone, bentonite, and ball clay. GMDC also has investments in renewable energy through wind and solar projects.
Headquartered in Gujarat, the company plays a vital role in India’s mineral resource sector, with a strong presence in districts like Kutch, Surat, Baroda, Rajkot, Jamnagar, Porbandar, Amreli, and Bhavnagar.
Gujarat Mineral Development Corporation
Key Financial Highlights
- Market Cap: ₹16,181 Cr
- CMP (Sep 05, 2025): ₹509
- 52-Week Range: ₹514 / ₹226
- P/E Ratio: 24.3
- Book Value per Share: ₹202
- Dividend Yield: 1.79%
- ROCE: 14.1%
- ROE: 10.9%
- Face Value: ₹2
Strengths (Pros)
- The company has a debt-free balance sheet, with borrowings of just ₹126 crore compared to assets of ₹7,752 crore in FY25.
- GMDC has a healthy dividend track record, paying out about 42% to 47% in recent years.
- Strong government backing is reflected in the 74% promoter holding, which helps ensure stability and continuity.
- The company has delivered a strong long-term price CAGR of 20% over 10 years, 58% over 5 years, and 38% over 3 years.
- A diversified mineral portfolio reduces the company’s dependence on any single commodity.
- Gujarat Mineral Development Corporation
Weaknesses (Cons)
- The company relies heavily on other income. In FY25, other income was ₹373 crore, which inflates overall profitability.
- Quarterly performance can be unpredictable, with sales and profits fluctuating significantly. The operating profit margin sometimes drops to 13%–14% in weaker quarters, while it can exceed 40% during stronger periods.
- The company is exposed to global commodity trends, including changes in demand, supply, and international pricing.
- Gujarat Mineral Development Corporation
Growth Trend
Sales Growth (CAGR)
- 10 Years: 7%
- 5 Years: 14%
- 3 Years: 1%
- TTM: 10%
Profit Growth (CAGR)
- 10 Years: 5%
- 5 Years: 36%
- 3 Years: 15%
- TTM: 18%
ROE & ROCE
- ROE: stable at 11–14% in recent years.
- ROCE: improved to 14% in FY25 from single digits in FY20.
- Gujarat Mineral Development Corporation
Quarterly Snapshot (Recent Trend)
- Q1 FY26 (Jun 2025):
- Sales: ₹733 Cr
- Net Profit: ₹164 Cr
- OPM: 23%
- EPS: ₹5.15
- Compared to the same quarter last year (Jun 2024), sales and profit are flat to slightly weaker, showing subdued demand for minerals.
- Gujarat Mineral Development Corporation
- GMDC’s business performance is highly linked with commodity prices. Investors often track Copper Price Today and other metals to understand market trends that directly influence GMDC revenues.
Peer Comparison
| Lloyds Metals | 1295 | 44 | 67,758 | 0.08% | 38% |
| NMDC | 75 | 10 | 65,587 | 4.51% | 29.6% |
| GMDC | 509 | 24 | 16,181 | 1.79% | 14.1% |
| Gravita India | 1,695 | 37 | 12,512 | 0.38% | 21.5% |
| MOIL | 352 | 26 | 7,171 | 1.14% | 19.1% |
Observation:
- GMDC trades at a mid-level valuation (P/E 24) compared to NMDC (cheaper at P/E 10), but it is below Lloyds Metals (more expensive at P/E 44).
- The dividend yield is attractive but lower than that of NMDC.
- ROCE and profitability are moderate compared to those of our peers.
- Gujarat Mineral Development Corporation
Shareholding (Jun 2025)
- Promoters: 74%
- FIIs: 2.25% (slightly increasing)
- DIIs: 0.79%
- Public: 22.97%
Retail participation has grown (2.5 lakh shareholders), showing rising interest.
Gujarat Mineral Development Corporation
Investment View
- Positives:
Debt-free, consistent dividends, strong promoter backing, exposure to renewable energy, and long-term CAGR growth. - Concerns:
Earnings volatility, high dependency on other income, and the cyclical nature of minerals. - Valuation:
At a P/E of ~24, GMDC appears fairly valued, not particularly cheap compared to NMDC, but still attractive due to its stability and government backing. - Outlook:
Suitable for long-term investors seeking stable dividends and moderate growth from the mining & energy sector. However, due to cyclical risks, the stock may show short-term volatility. - Gujarat Mineral Development Corporation
Conclusion
GMDC is a stable, government-supported company in the mining sector with a solid balance sheet and regular dividends. While its earnings can be influenced by other income and industry cycles, its range of minerals and focus on renewable energy make it a good choice for long-term investors who want both stability and growth. If you are considering investing, waiting for the price to come closer to ₹450–₹470 could offer a better margin of safety.
Gujarat Mineral Development Corporation
For more details, visit the Official GMDC Website, check the latest share price on NSE India and BSE India. Investors can also explore the Annual Reports or view detailed financials on Moneycontrol and Screener.
Frequently Asked Questions (FAQ) on GMDC
Q1: What does GMDC do?
👉 GMDC (Gujarat Mineral Development Corporation Ltd) is a state-owned company engaged in mining (lignite, bauxite, fluorspar, manganese, limestone, bentonite, ball clay) and power generation (thermal, wind, solar).
Q2: Is GMDC a debt-free company?
👉 Yes, GMDC is almost debt-free with negligible borrowings, making its balance sheet strong.
Q3: Does GMDC pay dividends?
👉 Yes, GMDC has a track record of healthy dividend payouts (around 40–45% payout ratio in recent years).
Q4: What are the risks in investing in GMDC?
👉 The biggest risks are earnings volatility, dependence on other income, and exposure to commodity cycles.
Q5: How is GMDC valued compared to peers?
👉 GMDC trades at a P/E of ~21–24, which is higher than NMDC (cheaper) but lower than Lloyds Metals (expensive). It is fairly valued in relation to its peers.
Q6: Who owns GMDC?
👉 The Government of Gujarat holds ~74% promoter stake. Public, FIIs, and DIIs hold the rest.
Q7: Is GMDC good for long-term investment?
👉 GMDC can be a steady long-term PSU play with dividends and strong backing, but investors must be cautious about commodity price cycles and quarterly fluctuations.
Gujarat Mineral Development Corporation
Disclaimer
- This content is created purely for educational and informational purposes.
- It does not constitute financial, investment, or trading advice.
- Stock market investments involve market risks, including possible loss of capital.
- The data used here is sourced from publicly available information that is believed to be reliable.
- Past performance is not indicative of future results.
- Readers are encouraged to conduct their own research (DYOR) before making an investment.
- The author/publisher shall not be responsible for any loss arising from the use of this content.
Good