GNG Electronics Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

GNG Electronics Ltd trades at ₹565, in a confirmed uptrend and 21 weeks into that stage. That is +29.8% against its own 200-day average. It sits at 77% of a 52-week range of ₹252 to ₹657. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 13 straight weeks.

Today the stock is in a confirmed uptrend — week 21 of stage 2, confirmed. At ₹565 it trades +29.8% versus its 200-day average and sits at 77% of its 52-week range (₹252–₹657).

Against the market, two honest reads. Cumulative: over the last 1.0 years the stock moved +81% while the NIFTY 500 moved +4% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 13 straight weeks — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Story check

GNG Electronics Ltd's story is not scored yet against the markers our research file set on 17 May 2026. Where it sits in its own cycle: EARLY_EXPANSION. Still open: DDR5 RAM fabs (Samsung/SK Hynix/Micron) take 18-24 months to ramp; if supply normalises by H2 FY27, new PC prices fall 10-15% and refurbished value proposition compresses from 3x to under 2x.

Our read, 17 May 2026. Memory shock created a structural demand gap — GNG monetised it first, but management credibility on guidance accuracy is a live watch item.

From the numbers. New IPO (July 2025), insufficient PE history for cycle analysis — quality_score=1, low_reliability=true. PE 38.8x at 75th percentile of LIMITED data. FIIs declining from 3.42% (Sep 2025) to 2.41% (Dec 2025) before…

From the price. Price stage 2, week 21 — above its 200-day line.

From the research. Memory shock created a structural demand gap — GNG monetised it first, but management credibility on guidance accuracy is a live watch item.

🚨 Where they disagree. New IPO (July 2025), insufficient PE history for cycle analysis — quality_score=1, low_reliability=true. PE 38.8x at 75th percentile of LIMITED data. FIIs declining from 3.42% (Sep 2025) to 2.41% (Dec 2025) before recovering to 2.78% (Mar 2026); DIIs building 4.62% to 5.20%. Stock priced for continued 25-30% growth. No historical trough or peak to reference — valuation discipline entirely dependent on growth sustenance.

What is proven. Memory shock created a structural demand gap — GNG monetised it first, but management credibility on guidance accuracy is a live watch item.

What is not proven yet. DDR5 RAM fabs (Samsung/SK Hynix/Micron) take 18-24 months to ramp; if supply normalises by H2 FY27, new PC prices fall 10-15% and refurbished value proposition compresses from 3x to under 2x.

🚨 Layer 1 read, 19 July 2026 — DROP. Real profits but no cash — FY26 operations burned Rs 215cr, plugged by debt, on a temporary memory-price windfall. GNG's FY26 earnings surge (revenue +34%, PAT +91%) is genuine and operating-driven, but the profits are not becoming cash: FY26 operating cash flow is -215cr with Rs 351cr of financing plugging the gap, working capital blew out 39->112 days. Management missed its own net-debt guidance by 11-15x (Rs 30-40cr guided, Rs 450-460cr actual), and the demand driver is a DDR5 price shock that normalizes as fabs ramp in 18-24 months. Real growth, poor cash quality, cyclical catalyst — bottom-P2.

What would change Layer 1’s mind. Two consecutive quarters of positive operating cash flow with the working-capital cycle compressing back below ~90 days AND net debt stabilizing per the newest guidance (proving the profits convert and the balance sheet is under control), OR clear evidence DDR5 prices hold above $80 through CY2027 (making the demand gap durable rather than a cycle). Absent that, a confirmed memory-price normalization collapsing the demand gap flips this to DROP.

The test written in advance. Memory cycle reversal — DRAM normalisation — Memory cycle reversal — DRAM normalisation DDR5 8GB RAM price index monthly; below $80 = caution, below $60 = thesis at risk by the next result.

The test written in advance. Management guidance credibility — four documented reversals — Management guidance credibility — four documented reversals by the next result.

The test written in advance. Working capital intensity — elevated inventory + receivables — Working capital intensity — elevated inventory + receivables Q1 FY27 net debt trajectory; receivables staying below Rs 220 Cr confirms channel management by the next result.

Lever 14 · A bigger market to sell into — BUILDING. DDR5 RAM up 5x, new PC prices +57% in India — 55-60M unit gap created; refurbished now prices below entry-level new with equal performance. What proves it keeps working: TAM Expansion via Memory Price Shock. It stops working if DDR5 8GB RAM price index monthly; below $80 = caution, below $60 = thesis at risk.

Lever 1 · Operating leverage — BUILDING. EBITDA growing 1.75x revenue growth rate; fixed-cost absorption across 8 UAE + India facilities; 2.5x capacity leverage headroom from 60k/month to 150k/month target. What proves it keeps working: Operating Leverage Inflection. It stops working if DDR5 8GB RAM price index monthly; below $80 = caution, below $60 = thesis at risk.

Lever 10 · New geographies — BUILDING. Revenue 67% international; US 21%, Europe 20%, UAE 12%; Ingram+Supertron distribution partnerships formalized; UAE facilities 3 to 8; advanced pipeline with EU+US tier-1 distributors. What proves it keeps working: Geographical Expansion (46 countries, UAE hub, distributor partnerships). It stops working if DDR5 8GB RAM price index monthly; below $80 = caution, below $60 = thesis at risk.

Lever 7 · Consolidation — BUILDING. Rs 1,000/month EMI programme launched with leading consumer finance partners — targets first-time buyers, students, SMBs previously priced out. What proves it keeps working: Affordability Programme + Consumer Financing. It stops working if DDR5 8GB RAM price index monthly; below $80 = caution, below $60 = thesis at risk.

Sources: our stock research file (17 May 2026) · quarterly results through Jun 26 · the company’s own earnings calls. The story check is re-scored every results season; the record below never changes.

Revenue Revenue is the top line: everything the company billed its customers in the period.

GNG Electronics Ltd reported ₹412 Cr of revenue in the Jun 26 quarter, +32.1% year on year. That is the 5th straight quarter of year-on-year growth. Over 6 years it has compounded at 40.6% a year. The last full year, FY26, came in at ₹1,891 Cr. The last four reported quarters add to ₹1,991 Cr.

Why this happened. The primary catalyst driving FY26 outperformance. DDR5 8GB RAM surged from $23.35 (October 2025) to $120 (April 2026), a 5x increase driven by AI hyperscaler and EV manufacturing demand competing for DRAM supply. 1TB SSD tripled from $70 to $249, processors rose 45%. New PC prices rose 57% in India (entry-level now Rs 40,000+) and 40% internationally ($440+). This created a 55-60M unit unmet demand gap as IDC forecast global PC shipments declining 11%. Premium refurbished at Rs 27,000 blended ASP now prices below entry-level new. Management characterises this as multiyear structural (AI/EV demand sustaining through CY2027) but semiconductor memory is cyclical — component price trajectory is…

FY26 revenue came in at ₹1,891 Cr (+34.0% on the year), capping 6 years at 40.6% compound. The latest quarter (Jun 26) printed ₹412 Cr, +32.1% year on year — the 5th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +35.0% growth against the decade's 40.6% — the current year is running slower than its own long-run rate.

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

GNG Electronics Ltd's operating margin is 12.0% in the Jun 26 quarter, +2.0 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 7 fiscal years the operating margin has ranged 2.4% to 10.0%. The current quarter is running above every full year in that window.

Why this happened. FY26 EBITDA grew ~71% on revenue growth of 34%. Q3 EBITDA +70.5% on revenue +40.3%. OPM expanded 166 bps full-year to 10.6%. Infrastructure investment is complete — no incremental capex needed for 2.5x capacity expansion from 60,000 to 150,000 units/month. Once utilisation steps up, fixed-cost absorption drives convex margin leverage. Q1 FY27 is the first test of whether sequential margin expansion resumes after Q4's seasonal compression to 9.8%.

The latest quarter's operating margin is 12.0%, +2.0 pp against the same quarter a year ago. Across 7 fiscal years the operating margin has ranged 2.4%–10.0%, and FY26's 10.0% is the top of that band — a record year.

Why the margin moved: operating margin went +1.6 pp year on year while gross margin went −29.9 pp — the gain came mostly from the gross line: input costs and pricing.

Worth repeating from the valuation section: cheap against its own history on record margins is not the same thing as cheap — a record margin flatters every ratio built on top of it.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

GNG Electronics Ltd earned ₹29.0 Cr of net profit in the Jun 26 quarter, +52.6% year on year. It is the 5th consecutive quarter of growth. Full-year FY26 profit was ₹132 Cr. The 6-year compound rate is 101.0%. That is 7.0% of the quarter's revenue. The same quarter a year earlier earned ₹19.0 Cr.

Jun 26 profit was ₹29.0 Cr, +52.6% year on year — the 5th consecutive quarter of growth. On the full year, FY26 printed ₹132 Cr (+91.3%), and the 6-year compound rate is 101.0%.

Why profit moved: revenue contributed +32.1% and the margin +2.0 pp — the quarter was margin-led: most of the profit growth came from keeping more of each sale.

Pace comparison, last four quarters: profit +95.4% vs revenue +35.0%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years −37% of GNG Electronics Ltd's reported profit arrived as operating cash — a gap worth watching. In FY26 that was ₹−215 Cr of operating cash against ₹132 Cr of profit. After ₹43.0 Cr of capital spending, ₹−258 Cr was left as free cash.

FY26: operating cash of ₹−215 Cr against reported profit of ₹132 Cr, leaving free cash of ₹−258 Cr after ₹43.0 Cr of capital spending. Across the last 3 fiscal years the conversion rate is −37% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

🚨 Why conversion sits at −37%: the cash cycle tightened 70 days between FY21 and FY26 — cash that used to wait in the cycle now reaches the bank sooner. Less than 70% of profit arriving as cash is the thing to watch on this page.

Router verdict: the bigger cash user is investment — capital spending ran 3.8× depreciation over three years, so the next section's job is to check what that build-out is buying.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

GNG Electronics Ltd's cash conversion cycle runs 40 days in FY26, down from 110 days in FY21. Capital spending ran ₹88.0 Cr over the last 3 years. At FY26 sales of ₹1,891 Cr each day of that cycle holds about ₹5.2 Cr, so roughly ₹207 Cr sits inside the business at any moment.

FY26: debtors at 40 days (an asset-light business — no inventory to speak of) — for a full cycle of 40 days, tighter than FY21's 110.

In money terms: at FY26 sales of ₹1,891 Cr, each day of the cycle holds about ₹5.2 Cr — so the 40-day loop keeps roughly ₹207 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹88.0 Cr over the last 3 fiscal years against ₹23.0 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹0.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

GNG Electronics Ltd earns a ROCE of 20% in FY26. That is up from a trough of 12% in FY21. Return on invested capital clears the cost of that capital by +4.4 percentage points, so growth here adds value rather than only size. The wiring behind it is 7.0% net margin on 1.51× asset turns.

FY26 ROCE is 20%, recovered from a FY21 trough of 12% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 7.0% net margin × 1.51× asset turns × 1.65× balance-sheet leverage ≈ 17.4% on equity. Margin does its share; leverage is a meaningful part of the equation.

The capstone test — ROIC − WACC: 16.4% − 12.0% = a +4.4 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. Positive but thin — value creation with little room for error.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

GNG Electronics Ltd carries total debt of ₹445 Cr against shareholder equity of ₹759 Cr as of Mar 26, a debt-to-equity of 0.59. On the annual view that ratio went from 2.00 in FY25 to 0.59 in FY26. Read the returns elsewhere on this page with that leverage in mind.

Mar 26: total debt of ₹445 Cr against shareholder equity of ₹759 Cr — a debt-to-equity of 0.59. On the annual view, debt-to-equity went from 2.00 (FY25) to 0.59 (FY26). Read the returns on this page with that leverage in mind.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

No holder of GNG Electronics Ltd moved a full percentage point over the last two years — the register is quiet. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — .

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

GNG Electronics Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

GNG Electronics Ltd trades at 45.2× P/E, at the pricey end of its own range (86th percentile). Its long-run median P/E is 37.9×, measured across 1.0 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 45.2× is at the pricey end of its own range (86th percentile), against a long-run median of 37.9× measured over 1.0 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved +63.3% against a +75.5% price move — the price outran earnings, pushing the multiple UP its own range.

Put together: the multiple is full against its own past, so the story rests on the earnings line underneath it, not the multiple.

Stage: No read Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

GNG Electronics Ltd reads as no read on its fundamental arc. Under eight usable quarters on the growth trio — not enough history for an honest trajectory read. The read is built from 5 quarters across 1 curve, on partial evidence.

Why it matters: with too little history, an honest page says so instead of guessing a trajectory.

One or more growth curves carry a base-effect spike — a large year-on-year move off a near-zero or loss-making comparable quarter. Those spikes are capped before the classifier reads the trajectory, and shown pinned on the chart, so a single distorted quarter does not drive the stage call.

Fewer than eight usable quarters on the growth curves — this page will not guess a trajectory from a stub of history.

4-Factor Sector Score

65.2/100 — rank 2 of 6 in New age - Platform - E-Retail · 74% evidence confidence

GNG Electronics Ltd scores 65.2 out of 100 against the 6 companies it is compared with in New age - Platform - E-Retail, ranking 2. Balanced evidence: keep at normal research priority and require another comparable period before raising conviction.

The four contributions add to the total exactly: 20.8 + 17.4 + 10 + 17 = 65.2. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Said versus delivered

What GNG Electronics Ltd's management promised, set against what actually arrived — 4 tracked promises on the record. Read straight from the company’s own earnings calls. A promise that slipped stays on this page after it is met.

Q4 FY26 Margin Compression vs. Prior Explicit Assurance · 5 May 2026. In the Feb 2026 call, management explicitly stated in closing remarks that Q4 FY26 would not see margin compression similar to Q4 FY25, citing better execution and a more favorable environment. In the May 2026 call, Q4 FY26 EBITDA margin was reported at 9.8%, down approximately 140 basis points from Q3 FY26's 11.2%. Management then attributed this sequential decline to typical Q4 dynamics driven by year-end volume push, directly contradicting the earlier explicit assurance by framing what was promised to be avoided as a routine seasonal outcome.

H2 FY26 Finance Cost: Explicit Savings Guidance vs. Actual Directional Reversal · 5 May 2026. In the Nov 2025 call, the CFO explicitly directed investors to factor in Rs. 10-12 crores of H2 FY26 interest cost savings from IPO-driven debt repayment, framing it as a near-certain bottom-line benefit for H2. By the Feb 2026 call, management had pivoted to accepting elevated interest costs as necessary for strategic inventory without formally retracting the prior quantified savings guidance. The May 2026 call confirmed Q4 FY26 finance cost alone reached Rs. 14.5 crores versus Q3's Rs. 9 crores with management stating this elevated run rate is likely to sustain, representing a complete directional reversal from the Nov 2025 explicit savings projection.

Debt Reduction & Interest Savings Reversal · 5 February 2026. Management explicitly guided in prior calls that post-IPO debt reduction would lower net debt to near-zero (approx INR 30-40 crores) and generate INR 20-23 crores in interest savings for the year. In the latest call, they revealed net debt has surged back to INR 450-460 crores to fund inventory, and admitted that full-year finance costs will basically remain flat year-over-year, negating the previously promised savings. Later call (Feb 2026): “The net debt on December 31 is approximately 450-460 crores... We anticipate that the full-year finance cost will remain more or less the same as last financial year.”

Change in Warranty Provisioning Policy · 5 February 2026. In the November call, management stated that warranty costs were structurally low (10-12 bps) and explicitly confirmed they had no provisioning mechanism in place. Three months later, despite citing similar cost percentages, they contradicted this policy by announcing a cumulative provision of 1.3 crores over and above actual costs and stating an intent to enhance this provision going forward. Later call (Feb 2026): “Additionally... the company has made a cumulative provision of 1.3 crores over and above actual warranty costs... This is an incremental provision that we will continue to enhance as the scale continues to grow.”

Every quote above is taken word for word from the company’s own earnings calls.

Frequently asked questions