GFL share price jumps 6% after unit incorporates step-down subsidiary

Gujarat Fluorochemicals (GFL) stock surged 5.6 per cent at Rs 3,368 per share on the BSE in Wednesday’s intraday deals. The stock price of the company surged after the company’s subsidiary GFCL EV Products incorporated the step down subsidiary in the Sultanate of Oman namely GFCL EV SPC on 11th June, 2024.

GFCL EV is a newly incorporated company for business development. It is being set up to manufacture high purity metal sulphate and complex metal phosphate.

The company in an exchange filing said initial subscription to be made by GFCL EV Products are up to Omr 2,50,000 or Rs 5.42 crore approximately. 

In the January-March quarter of fiscal year 2023-24, GFL reported a year-on-year drop of 69.6 per cent in net profit, amounting to Rs 101 crore for the fourth quarter ending March 31, 2024. In comparison, the company had posted a net profit of Rs 331.9 crore in the same quarter of the previous year. 

The company's revenue from operations also declined by 23 per cent to Rs 1,133 crore compared to Rs 1,471.4 crore in the corresponding period of the previous fiscal.

At the operating level,  earnings before interest, tax, depreciation, and amortisation (EBITDA) plummeted by 55.1 per cent to Rs 237.6 crore in the fourth quarter of the current fiscal, down from Rs 529.3 crore in the corresponding period of the previous fiscal. The EBITDA margin for the reporting quarter stood at 21 per cent, a decrease from 36 per cent in the corresponding period of the previous fiscal. 

At 12:43 PM; the stock of the company gave up most of its intraday gain and was trading 1.03 per cent higher at Rs 3,221.15 per share on the BSE. By comparison the BSE Sensex climbed up by 0.58 per cent. 

The stock of the GFL is presently trading at a price to earnings multiple of  83.64 times with an earning per share of Rs 38.12 .