RIL Company Analysis – GPHISPAT

Metals have been one of the core drivers of industrialization. Among metals, steel has historically held a dominant position. As raw material and intermediate products, the production and consumption of steel are widely regarded as indicators of economic progress. Thus, it would not be an overstatement to say that the steel industry has always been at the forefront of industrial development and forms the backbone of any economy.

Bangladesh is one of Asia’s blooming emerging steel markets and has a growing need for raw materials and steelmaking technologies. Now, Bangladesh has a $5.9 billion industry with 8 to 8.5 million MT of annual production capacity. Now around 45 rolling mills are operating in Bangladesh. In the past few years, a good number of steel and re-rolling mills were set up in Bangladesh.

GPH Ispat always focuses on the long-term strategic plan for the sustainable growth of the Company. In this connection, a large-scale expansion of production capacity is going on with the world’s most advanced technology based on “EAF Quantum Technology”. This type of technology is being used for the first time in Bangladesh as well as in the Asian region. GPH Ispat holds about 25% of the total market share amongst other players in the market, like AKS, KSRM, GPH Ispat, and RSRM. GPH Ispat not only produces structural bar but is also one of the producers of low, medium carbon & low alloy Steel Billets in Bangladesh. GPH Steel Billets and Bars are getting exported to other countries after nourishing national demand.

The market price per share of GPH Ispat is BDT 53.40 which implies the share price is undervalued compared to its intrinsic value of BDT 75.51. Hence, there would be attractive long-term growth prospects and investors may get the potential return from investing this share at the current price level.

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