Whalesbook
Investor Akash Bhanshali is maintaining significant stakes in Gujarat Fluorochemicals Limited (GFL) and One 97 Communications (Paytm), even as both stocks have pulled back from their peaks. This suggests a focus on long-term transformation rather than short-term market moves. GFL is pivoting to materials for India's green energy sector, but faces profit swings and margin pressures. Meanwhile, Paytm has reached profitability after a decade of losses, driven by cost cuts and navigating regulatory hurdles, recently securing a crucial payment aggregator license. These stories highlight the challenges of creating value amid industry changes and strict regulations.
GFL's Green Ambitions Face Profit Pressure
Gujarat Fluorochemicals Limited (GFL) is focusing on supplying materials for India's growing green energy sector, particularly PVDF, which is crucial for solar panels and batteries. Its parent group is also investing in solar cell manufacturing, aiming for significant capacity by 2026. GFL has shown strong sales growth, with revenue at Rs 4,737 crore in FY25 and EBITDA expanding by about 20% compounded annually. However, net profit has been inconsistent, dropping in FY24 after a FY23 peak.
The company is feeling pressure from falling margins in its refrigerant segment due to global quota changes and seasonal demand. Higher input costs and potential U.S. tariffs also create challenges. GFL's stock trades at a Price-to-Earnings (P/E) ratio of around 53x, well above the industry median of 25x. Analysts have mixed ratings, with price targets near ₹3,700-₹3,757. The stock, currently 34% off its high, shows neutral momentum according to its RSI. Despite projected growth in the specialty chemicals sector, GFL faces risks from fluctuating commodity prices and competition.
Paytm Navigates Profitability and Regulation
One 97 Communications (Paytm) is now profitable after operating losses for a decade, especially after facing regulatory restrictions on its associated bank. The company shifted its strategy to focus on higher-margin services like loans and insurance, moving away from low-fee payments. This shift included aggressive cost-cutting and partnerships with other banks for payment processing.
For the first three quarters of FY26, Paytm reported operating profits of Rs 367 crore and net profits of Rs 357 crore, with sales at Rs 6,173 crore. Questions remain about the sustainability of these profits, as cost reductions play a large role. The company faces continued regulatory scrutiny, including a show-cause notice for alleged FEMA violations worth Rs 611 crore. A key positive development is that its subsidiary, Paytm Payments Services Limited, secured the Payment Aggregator license from the RBI in November 2025, allowing it to onboard merchants.
Paytm's stock trades at a high P/E of over 124x, significantly above the industry average of 20x. Analysts generally hold a 'Moderate Buy' rating, with price targets around ₹1,312 to ₹1,420, though market investment is becoming more selective for fintech companies.