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 ₹669, in a confirmed uptrend and 27 weeks into that stage. That is +37.3% against its own 200-day average. It sits at 92% of a 52-week range of ₹252 to ₹703. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 19 straight weeks.

Today the stock is in a confirmed uptrend — week 27 of stage 2, confirmed. At ₹669 it trades +37.3% versus its 200-day average and sits at 92% of its 52-week range (₹252–₹703).

Against the market, two honest reads. Cumulative: over the last 1.1 years the stock moved +114% while the NIFTY 500 moved +0% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 19 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 22 August 2026. Where it sits in its own cycle: EARLY_EXPANSION. Our fortnightly research layers last read it on 22 August 2026.

Our read, 22 August 2026. Q1 FY27 confirmed the operating thesis — gross margin surged to 24.6%, PAT up 56% — but management has now reversed on net debt for the third consecutive time, and promoters sold a 4% stake in Q1 FY27 without disclosure.

From the numbers. The stock has re-rated 44% from Rs 419 to Rs 606 since the prior timeline, placing PE at approximately 48 times TTM earnings — the highest since listing. The PE at the 80th percentile of 13 months of post-listing data…

From the price. Price stage 2, week 27 — above its 200-day line, relative strength rising.

From the research. Q1 FY27 confirmed the operating thesis — gross margin surged to 24.6%, PAT up 56% — but management has now reversed on net debt for the third consecutive time, and promoters sold a 4% stake in Q1 FY27 without disclosure.

🚨 Where they disagree. The stock has re-rated 44% from Rs 419 to Rs 606 since the prior timeline, placing PE at approximately 48 times TTM earnings — the highest since listing. The PE at the 80th percentile of 13 months of post-listing data is an emerging opportunity label with very limited cycle history. FIIs increased sharply from 2.78% to 5.27% in Q1 FY27 alongside a 3.93 percentage point promoter reduction, suggesting institutional demand absorbed a secondary sale. The valuation is no longer cheap — the stock is priced for continued 25 to 30% growth. No historical cycle floor exists to anchor a valuation on a growth deceleration.

What is proven. Q1 FY27 confirmed the operating thesis — gross margin surged to 24.6%, PAT up 56% — but management has now reversed on net debt for the third consecutive time, and promoters sold a 4% stake in Q1 FY27 without disclosure.

What is not proven yet. If DDR5 8GB RAM falls below $80 and net PC shipments stabilise, the refurbished value proposition narrows from 3x to under 2x and revenue growth would decelerate sharply from the current 30-plus percent — that is the single observation that breaks the whole thesis. A second invalidating signal: if net debt rises above Rs 500 crore in Q2 FY27, the inventory-carry thesis has become a balance-sheet impairment risk, not an opportunity.

🚨 What would change our mind. If DDR5 8GB RAM falls below $80 and net PC shipments stabilise, the refurbished value proposition narrows from 3x to under 2x and revenue growth would decelerate sharply from the current 30-plus percent — that is the single observation that breaks the whole thesis. A second invalidating signal: if net debt rises above Rs 500 crore in Q2 FY27, the inventory-carry thesis has become a balance-sheet impairment risk, not an opportunity.

🚨 Layer 1 read, 22 August 2026 — DROP. Fast-growing profits built on one thing — dear memory chips — and funded by borrowing, not by cash. GNG buys used laptops, refurbishes them and sells them in 49 countries, and business is booming: sales up 32% and profit up 56% last quarter, with the gross margin at its best ever. The reason is that computer memory costs about five times what it did in October 2025, so new PCs cost 57% more in India and a refurbished machine at a third the price sells itself. The catch is that growing has consumed cash rather than made it — the company earned Rs 132 Cr last year but its operations DRAINED Rs 215 Cr, and borrowings have just jumped from Rs 300 Cr to Rs 406 Cr in one quarter, right after management said debt was heading down.

What would change Layer 1’s mind. Net debt at or below Rs 380 Cr in the Q2 FY27 print with operating cash flow turning positive — that would prove the Rs 700 Cr of inventory converts to cash at a margin premium rather than accumulating as debt, and would lift this several ranks. The reverse breaks it outright: net debt above Rs 500 Cr in Q2 FY27 turns the inventory-carry thesis into a balance-sheet impairment. Separately, DDR5 8GB falling below about $80 would narrow the refurbished price advantage from roughly three times to…

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

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

🚨 What the surface reading misses. The surface reading is: PE at 80th percentile of a limited post-listing history suggests the stock is expensive relative to its own range. The research reads it further: The 80th percentile is based on only 13 months of post-IPO data (August 2025 to August 2026). There is no 10-year cycle to validate this against. The quality_score of 1 and limited data sufficiency means this percentile reading has very low information content — the company could be at the start of a multi-year re-rating or near a cyclical peak; the data cannot discriminate.

🚨 What the surface reading misses. The surface reading is: Promoter selling while a stock has run 44% is a negative insider signal. The research reads it further: The FII and DII bought what promoters sold — the simultaneous institutional pickup of 411 basis points in aggregate matches almost exactly the 393-basis-point promoter reduction. This is more consistent with a marketed secondary placement to quality institutions than insider exit selling. The promoter still holds 74.78% — a strong majority. However, management did not disclose or discuss this in the July 2026 call, which is a transparency gap.

Lever 14 · A bigger market to sell into — BUILDING. DDR5 RAM up 5x from October 2025, new PCs up 57% in India — the 55-to-60 million unit demand gap is sustaining refurbished volumes at premium ASPs. What proves it keeps working: TAM Expansion via Memory Price Shock. It stops working if DDR5 8GB RAM falls below $80 — at that level new PC prices recover enough to compress the refurbished cost advantage from 3x to under 2x, making the GNG value proposition optional rather than structural.

Lever 1 · Operating leverage — BUILDING. Gross margin reached 24.6% in Q1 FY27 (up 329 bps YoY) — well ahead of guidance; geographic mix (international at 30% vs India 21%) and ASP gains driving the premium. What proves it keeps working: Operating Leverage — Gross Margin Inflection. It stops working if Gross margin reverts toward 20% — signalling that the geographic mix advantage has normalised or component cost arbitrage benefit has been passed through to customers rather than retained.

Lever 10 · New geographies — BUILDING. Revenue 64% international; 49 countries, 5,130 touchpoints, 773 suppliers; national distributors Redington, Ingram, Supertron scaling; UAE hub contributes near 30% international margin. What proves it keeps working: Geographical Expansion (49 countries, distributor partnerships).

Lever 7 · Consolidation — BUILDING. Rs 1,000 per month EMI programme active with consumer finance partners — targets first-time buyers and students priced out of new PCs. What proves it keeps working: Affordability Programme + Consumer Financing.

Sources: our stock research file (22 August 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. Q1 FY27 confirmed the structural demand driver is intact. Memory prices remained elevated (DDR5 8GB at $126, 16GB at $231 on June 30 — more than fivefold above October 2025 levels). Management reported growing demand across India, the US, Europe, and the Middle East. 150,000 units were shipped in Q1 FY27, up from approximately 125,000 in Q1 FY26. The refurbished value proposition — premium devices at roughly 30% of new-laptop prices — is expanding as AI adoption deepens compute requirements. The tail risk remains: if DRAM fabs normalise supply by late 2026, new PC prices could fall 15% and the value gap narrows sharply.

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. The Q1 FY27 gross margin at 24.6% is the highest in the company's post-IPO history, up 542 basis points from Q4 FY26's 19.2% trough. The margin drivers are: geographic mix (developed markets contribute margins near 30% vs India 21%), laptop ASP rising 12% to Rs 30,763, and strategic inventory bought at pre-escalation prices. Management cited EBITDA at 12.8% vs 11.3% in Q1 FY26. Current facility capacity of 150,000 units per month (target) from 60,000 per month (current) provides 2.5x operating leverage headroom as volumes scale.

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 −92% 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 −92% 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 −92%: the cash cycle stretched 103 days between FY21 and FY26 — more of each rupee of profit waits inside the cycle before arriving. Less than 70% of profit arriving as cash is the thing to watch on this page.

Router verdict: conversion is below par and the cash cycle has stretched 103 days — the next section's job is to find where the cash is stuck.

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 213 days in FY26, up 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 ₹1,104 Cr sits inside the business at any moment.

FY26: debtors at 40 days, inventory at 180 days — roughly 5.9 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of 213 days, looser than FY21's 110.

The full loop: cash goes out to suppliers and production on day 0; stock waits 180 days to sell; customers pay about 40 days after that; and suppliers themselves are paid at 7 days — netting out to the 213-day cycle.

In money terms: at FY26 sales of ₹1,891 Cr, each day of the cycle holds about ₹5.2 Cr — so the 213-day loop keeps roughly ₹1,104 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 working-capital loop is the cash sink the router flagged — watch the cycle, not the P&L.

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 53.8× P/E, at the pricey end of its own range (95th percentile). Its long-run median P/E is 38.0×, measured across 1.2 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 53.8× is at the pricey end of its own range (95th percentile), against a long-run median of 38.0× measured over 1.2 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 +62.9% against a +93.6% 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.

What the price assumes This reading works the multiple backwards. It asks one question: what yearly rate of profit growth is a buyer at the market price already paying for? The number is the growth rate that makes eleven years of profit — six years growing, then five fading — add up to that day's market price, once each year is discounted at 11% a year.

Solved at its 25 August 2026 price, GNG Electronics Ltd was paying for profit growth of about 25.2% a year. Profit itself has compounded 101.0% a year over the past 6 years. Today the market pays 53.8× P/E, the 95th percentile of its own 1-year range.

What the two numbers say together. The multiple is full against its own past, and the growth the price is paying for is below what this company has actually delivered.

How to hold this number: it is a reading of one day's price, taken on 25 August 2026, not a running figure — every other number on this page, the multiple included, is read off the live quote as of 28 September 2026. A higher price is paying for more growth and a lower price for less, so it moves whenever the price does, and this page does not restate it between measurements.

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

No sector-relative score — GNG Electronics Ltd is score temporarily unavailable — [mlaSectorData] ambiguous sector slug "new-age-platform-e-retail": New age - Platform - E-Retail, New age Platform E Retail for undefined.

The score is a rank WITHIN a peer set: every metric is scored by percentile against the other members. Without the peer set there is no score to state, so none is invented here.

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.

FY27 Top-Line Guidance Raised Without a Quantified Bridge · 30 July 2026. In the May 2026 call, management guided to around 25% revenue growth for the next financial year. In the July 2026 call, it raised the top-line target to 30%, a material upward revision; although management cited strong Q1 execution and demand, it did not provide a quantified explanation for the change from the May outlook.

Net Debt Deleveraging Trajectory Reversed · 30 July 2026. In May 2026, management said net debt had declined to approximately INR300 crore and described that as the expected trajectory going forward. In July 2026, net debt had increased by more than INR100 crore to INR406 crore in one quarter, despite management saying working capital was about the same size; the latest call does not clearly reconcile this reversal with the prior deleveraging narrative.

Inventory Duration Description Changed Materially · 30 July 2026. The May 2026 call characterized the approximately INR740 crore inventory balance as equivalent to roughly three to four months of business volume. The July 2026 call instead said the company needs only 30-40 days of finished inventory; this may reflect a distinction between finished goods and total inventory, but management did not explain the difference, which is material for assessing working capital intensity and inventory risk.

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.

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

Frequently asked questions