Gandhar Oil Refinery share price target 2024, 2025, 2026, 2027, 2030 prediction

Gandhar Oil Refinery India Limited is a leading manufacturer of white oils in India, which are used in various industries such as personal care, healthcare, automotive, industrial, tyre and rubber. The company has recently made its initial public offering (IPO) and listed its shares on the stock exchanges. In this article, we will look at Gandhar Oil Refinery share price target 2024, 2025, 2026, 2027, 2030.

In this blog post, we will also analyze the company’s business, financials, growth prospects, strengths, weaknesses, opportunities, threats, risks, and key factors to watch out for. We will also compare the company with its competitors and provide our opinion on whether it is a good investment opportunity or not.

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Gandhar Oil Refinery share price target 2024, 2025, 2026, 2027, 2030

Gandhar Oil Refinery share price target 2024

In 2024, the Gandhar Oil Refinery Share Price Target had a minimum target of ₹300, a maximum target of ₹350, and an average target of ₹325.

Gandhar Oil Refinery share price target 2025

For the year 2025, the Gandhar Oil Refinery Share Price Target ranged from a minimum of ₹345 to a maximum of ₹403, with an average target of ₹374.

Gandhar Oil Refinery share price target 2026

In 2026, the Gandhar Oil Refinery Share Price Target varied from ₹397 as the minimum target to ₹463 as the maximum target, with an average target of ₹430.

Gandhar Oil Refinery share price target 2030

In 2030, the Gandhar Oil Refinery Share Price Target had a minimum target of ₹694, a maximum target of ₹810, and an average target of ₹752.

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Gandhar Oil Refinery share price live chart

Overview of Gandhar Oil Refinery Stock

Gandhar Oil Refinery, established in 1989, boasts over three decades of expertise in the petroleum and specialty oils sector. Renowned for its wide-ranging product portfolio, Gandhar Oil offers an impressive array of over 440 products under its flagship brand, Divyol. These products cater to a diverse array of industries, including personal care, healthcare, automotive, and more.

In FY23, Gandhar Oil Refinery emerged as India’s leading white oil manufacturer in terms of revenue, encompassing both domestic and international markets. The company’s global presence is marked by its ranking among the top five players worldwide by market share in CY21.

Financially, Gandhar Oil Refinery has demonstrated consistent growth and profitability, evidenced by a revenue CAGR of 15.13% and a PAT CAGR of 30.3% from FY21 to FY23. The company’s initial public offering (IPO) witnessed an overwhelming subscription rate of 64.07 times, attracting significant interest across investor categories and raising Rs 500.69 crore.

The company’s stock market debut was nothing short of spectacular, listing at a 75% premium over its issue price and closing with a market capitalization of Rs 2,411.20 crore, highlighting its robust performance and investor confidence.

Consider reading: Gandhar Oil Refinery IPO Details

Competitors of Gandhar Oil Refinery Stock

Gandhar Oil Refinery operates in a dynamic and competitive market, sharing the arena with notable firms such as Savita Oil Technologies, Raj Petro Specialities, Panama Petrochem, Apar Industries, and Eastern Petroleum. Each of these competitors brings unique strengths and a diverse range of products to the table.

1. Savita Oil Technologies: A major contender in the petroleum specialty sector, Savita Oil Technologies mirrors Gandhar Oil in its product offerings, which include transformer oils, liquid paraffin, white oils, and more. Boasting three manufacturing sites in India, the company has a global footprint extending to over 30 countries, showcasing its international market reach.
2. Raj Petro Specialities: Standing out with a vast array of over 500 products, Raj Petro Specialities is a formidable player, especially in the white oil segment. Its product range spans transformer oils to industrial oils, supported by four manufacturing facilities in India. The company’s global outreach includes exports to over 35 countries.
3. Panama Petrochem: As a leading manufacturer and exporter, Panama Petrochem offers a broad spectrum of petroleum specialty products, including liquid paraffin, white oils, and petroleum jelly. The company’s robust infrastructure, with four manufacturing units in India, enables it to export to more than 50 countries worldwide.
4. Apar Industries: Known for its diversified interests, Apar Industries is a giant in power transmission and specialty oils. It holds the title of India’s largest transformer oil manufacturer and also produces a range of other products like white oils and industrial greases.
5. Eastern Petroleum: Specializing in petroleum specialty products, Eastern Petroleum’s portfolio includes white oils, petroleum jelly, and transformer oils. The company, with two manufacturing plants in India, extends its market reach to over 20 countries, demonstrating its global presence.

Growth Opportunity for Gandhar Oil Refinery Stock

Gandhar Oil Refinery is poised for significant growth, capitalizing on the expanding white oil market projected to reach USD 8.1 billion by 2026, growing at a CAGR of 5.2% from 2021. Key growth drivers include rising demand in personal care and healthcare sectors, increasing disposable incomes, urbanization trends, heightened awareness of hygiene and wellness, and the development of innovative products.

Strategically positioned, Gandhar Oil Refinery boasts a robust product portfolio, a diversified customer base, extensive distribution networks, global reach, cost-efficient manufacturing, and a commitment to innovation and quality. This positions the company to effectively harness the market’s potential.

The company’s focused growth plan includes utilizing IPO proceeds for multiple strategic initiatives:

1. Debt Reduction: Allocating Rs 150 crore towards repaying or pre-paying loans to improve financial stability, reduce interest costs, and enhance the debt-equity ratio, thereby boosting profitability.
2. Capacity Expansion: Investing Rs 100 crore in equipment and infrastructure for increasing production capacity in automotive oil, petroleum jelly, and white oils, aligning with market demand and diversifying the product mix.
3. Working Capital Enhancement: Strengthening working capital with an injection of Rs 100 crore to support ongoing operations and growth initiatives.
4. Innovation and Product Development: Gandhar Oil plans to leverage its strong R&D capabilities and technical expertise to innovate and develop new products, enhancing product quality and meeting evolving customer preferences.

These strategic steps are expected to not only expand Gandhar Oil’s market share but also improve operational efficiency and economies of scale, ensuring the company remains a formidable player in the rapidly evolving white oil sector.

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Strengths of Gandhar Oil Refinery Stock

Gandhar Oil Refinery stands out in the white oil market with a robust set of strengths that solidify its competitive edge:

1. Market Leadership: As the leading manufacturer of white oils in India and a top-five global player, Gandhar Oil commands a notable 14.5% market share in India and 3.5% globally as of CY21. This leadership status underscores its significant industry impact.
2. Diverse Product Portfolio: The company offers an extensive range of over 440 products, meeting the demands of various sectors including personal care, healthcare, automotive, and more. This diversity positions Gandhar Oil as a versatile and responsive market participant.
3. Broad Customer Base: Gandhar Oil’s expansive customer network includes over 1,500 clients, featuring prominent names like Hindustan Unilever and Colgate-Palmolive. Such a diversified clientele highlights the company’s strong market presence and reliability.
4. Extensive Distribution Network: With a network of over 1,000 distributors and dealers across India, and a presence in over 40 countries spanning continents, Gandhar Oil demonstrates exceptional market reach and accessibility.
5. Efficient Manufacturing Capabilities: The company operates three advanced manufacturing facilities with a combined annual capacity of 522,403 KL (as of October 2022) and boasts an impressive capacity utilization of 91.9% in FY23. This efficiency underscores its operational excellence.
6. Commitment to Innovation and Quality: Gandhar Oil’s dedicated R&D team, sophisticated laboratory facilities, and adherence to various certifications (ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 22716:2007, GMP, HALAL, KOSHER) highlight its unwavering focus on innovation and quality.

Weakness of Gandhar Oil Refinery Stock

Gandhar Oil Refinery, while a strong player in the white oil market, faces certain challenges that could impact its growth and profitability:

1. Supplier Dependence: The company relies heavily on a limited number of suppliers for key raw materials like base oils and additives, most of which are imported. This dependency exposes Gandhar Oil to risks associated with price volatility and material availability, potentially affecting its supply chain stability.
2. Foreign Exchange Vulnerability: A significant portion of Gandhar Oil’s business dealings are in foreign currencies, making it susceptible to foreign exchange fluctuations. These currency variations can adversely influence the company’s revenues, costs, and profit margins, adding a layer of financial uncertainty.
3. Working Capital Intensity: Operating primarily on credit with its customers, Gandhar Oil needs to maintain high inventory levels to fulfill demand. This requirement results in substantial working capital needs, which could strain the company’s financial resources and impact its liquidity.
4. Regulatory and Environmental Compliance: As part of a highly regulated industry, Gandhar Oil must navigate various approvals, licenses, and compliance requirements. Additionally, adherence to stringent environmental norms can escalate operational costs and liabilities, posing a challenge in maintaining cost efficiency and regulatory adherence.

SWOT Analysis of Gandhar Oil Refinery Stock

Based on the above analysis, we can summarize the strengths, weaknesses, opportunities and threats of Gandhar Oil Refinery stock in a SWOT matrix, as shown below:

Strengths:

• Market Leadership: Gandhar Oil’s status as a leading manufacturer of white oils in India and a significant global player.
• Diverse Product Range: A strong portfolio serving various industries, including personal care and automotive.
• Broad Customer Base: Relationships with top-tier companies in personal care and healthcare.
• Extensive Distribution: A widespread network in India and internationally.
• Operational Efficiency: Cost-effective and efficient manufacturing processes.
• Innovation Commitment: A strong focus on research, development, and quality enhancement.

Weaknesses:

• Supplier Reliance: High dependence on a limited pool of suppliers for essential raw materials.
• Currency Risk: Vulnerability to foreign exchange fluctuations impacting financials.
• Capital Intensive Operations: High working capital requirements due to credit-based operations and inventory management.
• Regulatory Challenges: Navigating the complexities of a heavily regulated industry with environmental compliance obligations.

Opportunities:

• Market Expansion: Growing demand in personal care and healthcare sectors.
• Economic Trends: Benefit from increasing disposable incomes and urbanization.
• Product Innovation: Potential for new product development and applications.
• Capacity Enhancement: Opportunities for expanding production capacity and diversifying product mix.

Threats:

• Competitive Landscape: Intense competition from both existing and emerging market players.
• Material Price Instability: Fluctuations in the cost and availability of key raw materials.
• Exchange Rate Fluctuations: Financial risks associated with foreign exchange movements.
• Regulatory Evolution: Potential impacts of changes in environmental and industry regulations.

Summary: Gandhar Oil is well-placed to capitalize on the expanding white oil market, driven by rising demand in key sectors and socio-economic trends. However, the company must navigate challenges like intense competition, raw material volatility, currency risks, and regulatory dynamics. This balanced SWOT analysis helps understand Gandhar Oil’s strategic position, highlighting areas for growth and caution.

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Gandhar Oil Refinery Company Financials

Gandhar Oil Refinery has demonstrated a robust financial trajectory over the past three fiscal years, reflecting sustained growth and profitability. A breakdown of key financial indicators from FY21 to FY23 illustrates this positive trend:

Financial Performance Highlights:

• Rising Revenue: Revenue climbed from Rs 1,029.63 crore in FY21 to Rs 1,487.77 crore in FY23, marking a significant growth trajectory.
• Revenue Growth Rate: The company witnessed a revenue growth of 15.05% in FY22 and an impressive 25.58% in FY23.
• Profit After Tax (PAT): PAT surged from Rs 54.67 crore in FY21 to Rs 92.34 crore in FY23, indicating robust profitability.
• PAT Growth: The growth in PAT stood at 29.63% in FY22 and 30.3% in FY23, showcasing consistent profit gains.
• Increasing PAT Margin: The PAT margin improved from 5.31% in FY21 to 6.21% in FY23.
• Earnings Per Share (EPS): EPS saw a steady rise from Rs 8.19 in FY21 to Rs 13.84 in FY23.
• Return on Equity (ROE) and Capital Employed (ROCE): ROE increased from 20.16% in FY21 to 22.61% in FY23, and ROCE from 23.01% to 25.97%, reflecting efficient use of equity and capital.
• Lower Debt-Equity Ratio: The ratio decreased from 0.69 in FY21 to 0.49 in FY23, indicating a stronger financial position and solvency.
• Healthy Dividend Payout: The dividend payout ratio was consistently favorable, at 15% in FY21, 16% in FY22, and 17% in FY23, highlighting shareholder value creation.

Summary: Gandhar Oil’s financials from FY21 to FY23 depict a company on an upward trajectory, marked by increasing revenue, profitability, and returns, alongside a declining debt-equity ratio. The company’s commitment to shareholder returns is evident in its healthy dividend payouts. These financial indicators underscore Gandhar Oil’s strong market position and operational efficiency.

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Risks in the Future for Gandhar Oil Refinery Stock

Gandhar Oil’s future trajectory, while promising, is not without potential risks that could impact its performance and market valuation. Understanding these risks is crucial for informed decision-making:

1. Crude Oil Market Dependency: Gandhar Oil’s core business hinges on the white oil market, which is directly influenced by global crude oil prices. Fluctuations in price, availability, and quality of crude oil can significantly affect the company’s raw material costs, production volumes, and profit margins.
2. Industry Cyclicality: The company operates in sectors such as personal care, healthcare, automotive, and others that are subject to economic cycles. Any downturns or disruptions in these industries could lead to reduced demand for Gandhar Oil’s products, affecting revenue and profitability.
3. Competitive Market Pressures: With the presence of established and emerging competitors in the white oil market, Gandhar Oil faces potential challenges like pricing pressures, market share erosion, and reduced margins. Keeping pace with competitors is essential for sustaining its market position.
4. Regulatory and Environmental Compliance: Gandhar Oil must continuously adapt to varying regulatory and environmental standards in its operational territories. Adhering to these evolving norms may incur additional costs, impacting operational efficiency and profitability.
5. Operational Risks: The business is susceptible to risks including fire, explosions, accidents, natural disasters, pandemics, and socio-political upheavals. These unforeseen events could damage assets, disrupt operations, affect employees and customers, and harm the company’s reputation and goodwill.

Summary: Looking ahead, Gandhar Oil faces several potential risks, including crude oil market volatility, industry cyclicality, competitive pressures, regulatory changes, and operational hazards. These factors could influence its business performance and stock valuation, making risk management a critical aspect of its strategy.

Key Things to Watch Out for Gandhar Oil Refinery Stock

Gandhar Oil, having recently entered the stock market on November 29, 2023, has shown a remarkable debut, with its stock surging 75% on the first trading day. The company concluded the day with a market capitalization of Rs 2,411.20 crore, indicating strong investor confidence.

The stock has garnered positive assessments from analysts and brokerage houses, who praise its robust fundamentals, growth potential, competitive strengths, and attractive valuation. Nonetheless, potential short-term volatility and market corrections could be influenced by factors like macroeconomic conditions, industry trends, company performance, peer comparison, investor expectations, and profit-booking activities.

Investors considering Gandhar Oil stock should closely monitor the following aspects:

1. Financial Reports: Evaluate the company’s quarterly and annual results to gauge its operational and financial health, growth, and profitability.
2. Expansion Efforts: Track the progress of Gandhar Oil’s expansion plans, which aim to boost production capacity, diversify product offerings, and increase market share.
3. Innovation and Quality Initiatives: Stay informed about the company’s efforts to develop new products and enhance product quality and performance.
4. Dividend Policy: Review the dividend policy to understand the company’s shareholder value proposition and cash flow status.
5. Debt Management: Observe the company’s debt repayment schedule to assess its financial stability and liquidity.
6. Market Position: Keep an eye on Gandhar Oil’s market share and ranking in both domestic and global white oil markets to evaluate its competitive stance and brand value.
7. Customer Dynamics: Consider the customer retention and acquisition rates, indicative of customer satisfaction and the company’s ability to attract new clients.
8. Raw Material Management: Monitor costs and availability of raw materials, which are crucial for production volumes and margins.
9. Foreign Exchange Risks: Assess the company’s exposure to foreign exchange risks and its hedging strategies.
10. Regulatory Compliance: Stay updated on the company’s adherence to regulatory and environmental norms, impacting operational efficiency and profitability.
11. Risk Mitigation Strategies: Understand the company’s approach to risk management and how it safeguards assets, operations, employees, and customers.

Summary: Gandhar Oil’s stock presents an appealing opportunity in the white oil market, backed by strong initial performance and favorable expert opinions. However, investors should be mindful of potential short-term fluctuations and consider the above factors for a well-informed investment decision.

Final Thoughts on Gandhar Oil Refinery share price target 2024, 2025, 2026, 2027, 2030

Gandhar Oil emerges as a noteworthy contender in the white oil market, distinguished by its considerable growth prospects, diverse product lineup, extensive customer network, broad distribution channels, and efficient manufacturing.

The company’s commitment to innovation and maintaining quality standards further solidifies its market position. Additionally, Gandhar Oil’s consistent growth pattern and profitability, coupled with favorable analyst ratings, underscore its potential as a sound investment.

However, prospective investors should be cognizant of potential short-term volatility, influenced by factors like crude oil price fluctuations, industry cyclicality, competitive market pressures, foreign exchange risks, and evolving regulatory landscapes. These elements warrant careful consideration and monitoring.

In conclusion, while Gandhar Oil presents an attractive investment opportunity in the white oil sector, investors are advised to remain vigilant about the aforementioned factors to make informed and strategic investment decisions.

FAQs on Gandhar Oil Refinery share price target 2024, 2025, 2026, 2027, 2030

What is Gandhar Oil Refinery share price target 2024?

During 2024, the Gandhar Oil Refinery Share Price Target encompassed a minimum target of ₹300, a maximum target of ₹350, and an average target set at ₹325.

What is Gandhar Oil Refinery share price target 2025?

In 2025, the Gandhar Oil Refinery Share Price Target spanned from a minimum of ₹345 to a maximum of ₹403, while the average target was ₹374.

What is Gandhar Oil Refinery share price target 2026?

During 2026, the Gandhar Oil Refinery Share Price Target exhibited a range from a minimum target of ₹397 to a maximum target of ₹463, with an average target of ₹430.

What is Gandhar Oil Refinery share price target 2030?

In 2030, the Gandhar Oil Refinery Share Price Target was defined by a minimum target of ₹694, a maximum target of ₹810, and an average target of ₹752.