­Stable operations:
GIPL’s revenue stood at Rs.67.70 Cr. in FY2025 (Prov.) against Rs.68.14 Cr. in FY2024. The stagnant revenue is on account of sluggish demand from construction sector during the first two quarters followed by extended monsoon hindering the order flow during the Q3FY2025. Further, the operating profit margins stood healthy at 19.34 percent in FY2025 (Prov.), marginally declined from 22.31 percent in FY2024. The deterioration in margin FY2025 is due to increased raw material costs and lower realization. Further, the PAT margin remained stable with marginal improvement to 2.79 percent in FY2025 (Prov) from 2.46 percent in FY2024.
Acuite believes that, the revenue is expected to improve at a rate of 5-10 percent yearly, due to increasing demand for gypsum boards across the country.

Moderate financial risk profile:
The company's financial risk profile is moderate marked by moderate networth, high gearing and moderate debt protection metrics. The company’s net worth stood at Rs. 10.13 Cr. as on March 31, 2025 (Prov.) as compared to Rs. 3.24 Cr. as on March 31, 2024. The improvement in networth is due to addition in equity capital of Rs.5.00 Cr. and reserves with additional Rs.5.00 Cr. of securities premium. The total debt, primarily consisting of long-term loans, stood at Rs.48.03 Cr. as on March 31, 2025 (Prov.) against Rs.52.43 Cr. as on March 31, 2024. The improved networth position led to improved gearing level and total outside liabilities to total net worth (TOL/TNW) of 4.74 times and 6.91 times respectively as on March 31, 2025 (prov.) from against 16.18 times and 21.53 times as on March 31, 2024. The debt protection metrics are moderate with DSCR and ICR of 1.09 times and 2.13 times respectively as on March 31, 2025 (Prov.) as against 1.33 times and 2.17 times as on March 31st 2024. Debt to EBITDA stood at 3.65 times as on March 31, 2025 (Prov.) against 3.43 times as on March 31, 2024. 
Acuite believes that the financial risk profile of the company will improve marginally on account of expected growth in scale of operations, however, remain average over the medium term.

­Intensive nature of working capital operations:
Working capital operations of the company are intensive in nature as reflected through the Gross Current Asset days (GCA) days of 268 days during FY2025 (Prov.), against 208 days in FY2024. The elongation of GCA is due to higher inventory days. The inventory holding days stood at 269 days during FY2025 (Prov.) against 192 days in FY2024. GIPL generally maintains its main raw material i.e. Gypsum rock inventory required for 3 months, other raw materials for 2 months and finished goods for 2 months, leading to higher inventory days. Debtor days stood at 21 days during FY2025 (Prov.) against 31 days in FY2024. GIPL allows credit period of around 30 days to its customers and enjoys an extended credit period of around 90 days from its suppliers. The current ratio stood moderate at 1.10 times as on March 31, 2025 (Prov.) against 1.09 times as on March 31, 2024. High inventory holding period resulted in full utilization of its fund based working capital facilities of Rs.13.50 Cr. during the past 8 months ending May 2025. Acuite believes that working capital operations of the company will remain intensive over the medium term.

Susceptibility of margins to fluctuations in raw material prices and cyclicality in construction sector:
Indian gypsum board industry is largely fragmented and faces stiff competition from established domestic players which sometimes results in lower price quotations for the customers and yields less margins. Furthermore, the performance is susceptible to cyclicality in the end user industries. GIPL products such as gypsum boards and gypsum powder are mainly used in construction sector, which is susceptible to the seasonal cyclicality and any adverse weather conditions may affect the demand and supply of gypsum boards.