The company's stock has been under severe pressure, trading at ₹9.46 as of February 10, 2026, down 31.40% over the past year and a staggering 57.71% over two years. The bearish technical trend that commenced on December 10, 2025, reflects deteriorating investor sentiment amidst concerns over erratic revenue patterns and compressed profitability. With an overall Mojo score of 31 out of 100 and a "SELL" rating, the stock faces significant headwinds despite operating in the high-growth media and entertainment sector.
Financial Performance: Erratic Revenue Growth Masks Profitability Concerns
The quarter-on-quarter revenue surge of 65.30% to ₹386.22 crores in Q2 FY26 from ₹233.65 crores in Q1 FY26 appears impressive on the surface but reveals troubling volatility when examined against the year-on-year decline of 65.69% from ₹1,125.60 crores in Q2 FY25. This dramatic fluctuation suggests that the company's revenue streams are highly unpredictable, potentially driven by lumpy project-based revenues rather than sustainable recurring business. The previous quarter (Q1 FY26) itself had witnessed a 14.03% sequential decline, further highlighting the inconsistent revenue trajectory.
| Quarter | Net Sales (₹ Cr) | QoQ Change | Net Profit (₹ Cr) | QoQ Change | PAT Margin |
|---|---|---|---|---|---|
| Sep'25 (Q2) | 386.22 | +65.30% | 1.43 | -3.38% | 0.53% |
| Jun'25 (Q1) | 233.65 | -14.03% | 1.48 | -840.00% | 0.77% |
| Mar'25 (Q4) | 271.78 | +5.19% | -0.20 | -126.32% | -0.18% |
| Dec'24 (Q3) | 258.36 | -77.05% | 0.76 | -48.99% | 0.40% |
| Sep'24 (Q2) | 1,125.60 | +386.66% | 1.49 | +3.47% | 0.18% |
| Jun'24 (Q1) | 231.29 | -17.49% | 1.44 | -15.29% | 0.79% |
| Mar'24 (Q4) | 280.31 | — | 1.70 | — | 0.83% |
Profitability metrics remain under considerable pressure. The operating profit margin (excluding other income) contracted to 1.64% in Q2 FY26 from 2.02% in Q1 FY26, indicating deteriorating operational efficiency despite higher revenue. The PAT margin compressed to 0.53% from 0.77% sequentially, reflecting the company's struggle to translate top-line growth into bottom-line expansion. Operating profit before depreciation, interest, and tax (PBDIT) excluding other income stood at ₹6.32 crores, up from ₹4.71 crores in Q1 FY26 but significantly lower in margin terms.
Interest expenses surged to ₹4.42 crores in Q2 FY26 from ₹3.58 crores in Q1 FY26, reflecting a 23.46% sequential increase. This rising interest burden, coupled with long-term debt of ₹166.83 crores as of March 2025, raises concerns about the company's financial leverage and debt servicing capability. The tax rate normalised to 20.31% in Q2 FY26 from an abnormally low 16.97% in Q1 FY26, but remains significantly below the exceptionally high 129.45% tax rate witnessed in Q4 FY25, which had resulted in a net loss that quarter.
Critical Concern: Revenue Sustainability
The company's half-yearly revenue for H1 FY26 at ₹619.87 crores represents a sharp 47.78% decline from H1 FY25, indicating that the underlying business momentum is weakening significantly. This structural decline in revenue generation capability poses serious questions about the company's competitive positioning and market relevance in the rapidly evolving media and entertainment landscape.
Operational Challenges: Weak Returns and High Leverage
Media Matrix Worldwide's operational efficiency metrics paint a concerning picture. The company's average return on equity (ROE) stands at a meagre 1.41%, significantly below industry standards and peer averages, indicating poor capital utilisation and weak profitability relative to shareholder equity. The latest ROE of 2.53% shows marginal improvement but remains far below acceptable thresholds for value creation. For context, higher ROE percentages indicate superior capital efficiency and profitability, making this a critical weakness for the company.
Return on capital employed (ROCE) averaged 10.90% over recent periods, with the latest reading at 13.05%. While this shows some improvement, the absolute level remains modest given the company's risk profile and sector dynamics. The EBIT-to-interest coverage ratio averaged just 1.72 times, indicating limited cushion to service debt obligations. This weak coverage ratio becomes particularly concerning when coupled with the company's debt-to-EBITDA ratio of 7.54 times, which signals high financial leverage and potential vulnerability during business downturns.
Balance Sheet Deterioration
Shareholder funds declined dramatically to ₹106.25 crores as of March 2025 from ₹266.27 crores a year earlier, primarily driven by a steep fall in reserves and surplus from ₹152.99 crores to negative ₹7.02 crores. This erosion of equity base, combined with rising long-term debt from ₹114.45 crores to ₹166.83 crores, has fundamentally weakened the company's financial foundation and reduced its capacity to absorb future shocks.
Working capital management presents another area of concern. The cash flow from operations turned negative at ₹25 crores in FY25 after generating positive ₹30 crores in FY24, indicating deteriorating operational cash generation. The debtors turnover ratio for H1 FY26 fell to its lowest level at 8.11 times, suggesting slower collection cycles and potential stress in realising receivables. Current assets stood at ₹256.47 crores against current liabilities of ₹64.29 crores, providing some liquidity cushion, but the quality of current assets and their realisability remain questionable given the business volatility.
Sector Context: Underperformance in a Booming Industry
The media and entertainment sector has witnessed robust growth, with the broader industry delivering returns of 286.84% over the past year. Media Matrix Worldwide's 31.40% decline over the same period translates to a staggering underperformance of 318.24 percentage points versus its sector peers. This dramatic divergence highlights company-specific challenges that have prevented it from participating in the sector's growth momentum, likely stemming from its business model limitations, operational inefficiencies, or competitive disadvantages.
The company's five-year sales growth stands at negative 0.82%, indicating a contracting revenue base over the long term despite operating in a structurally growing sector. This persistent decline in sales suggests that Media Matrix has been losing market share, failing to adapt to changing consumer preferences, or struggling with technology transitions that have benefited competitors. In contrast, the company's five-year EBIT growth of 7.36% appears positive but must be viewed in the context of the extremely low base and inconsistent quarterly performance.
| Company | Market Cap (₹ Cr) | P/E Ratio (TTM) | P/BV Ratio | ROE (%) | Debt to Equity |
|---|---|---|---|---|---|
| Media Matrix | 1,093 | NA (Loss Making) | 7.98 | 1.41 | 0.11 |
| Jagran Prakashan | — | 8.57 | 0.76 | 9.69 | -0.31 |
| Den Networks | — | 7.50 | 0.38 | 6.26 | -0.87 |
| Signpost India | — | 25.95 | 5.17 | 20.09 | 0.57 |
| Balaji Telefilms | — | 16.09 | 1.77 | 3.62 | -0.19 |
| Panorama Studios | — | 29.15 | 5.41 | 26.38 | 0.37 |
The peer comparison reveals Media Matrix's significant disadvantages across key metrics. The company's ROE of 1.41% pales in comparison to the peer average of approximately 13%, with leaders like Panorama Studios delivering 26.38% and Signpost India achieving 20.09%. Despite this weak profitability, Media Matrix trades at a price-to-book value of 7.98 times, substantially higher than the peer average of around 2.7 times, indicating significant overvaluation relative to fundamentals. The company ranks fifth in market capitalisation among its peer group at ₹1,093 crores, positioning it as a smaller player in the competitive landscape.
Valuation Analysis: Expensive Multiple Without Justification
Media Matrix Worldwide's valuation metrics present a troubling picture of overvaluation without commensurate quality or growth to justify premium pricing. The stock's price-to-earnings ratio stands at an astronomical 315 times trailing twelve-month earnings, compared to the industry average of 75 times. This extreme valuation multiple becomes even more concerning when considering the company's weak ROE, declining revenues, and inconsistent profitability.
The price-to-book value of 7.98 times significantly exceeds reasonable levels for a company with such weak returns on equity. Typically, companies commanding high P/BV multiples demonstrate superior ROE, strong growth prospects, and competitive advantages—none of which apply to Media Matrix in its current state. The EV-to-EBITDA multiple of 53.90 times and EV-to-EBIT of 55.88 times further confirm the expensive nature of the valuation, particularly when juxtaposed against the company's modest operational performance and high debt levels.
The company's valuation grade has consistently remained in the "Expensive" to "Very Expensive" range since June 2021, with a brief period classified as "Risky" in early 2022. The current "Expensive" designation, in place since May 2024, reflects the market's continued willingness to assign premium valuations despite deteriorating fundamentals. The stock trades 48.98% below its 52-week high of ₹18.54, suggesting that even at current depressed levels, the valuation remains stretched relative to the company's earnings power and growth trajectory.
Shareholding Pattern: Stable Promoter Base, Zero Institutional Interest
The shareholding pattern reveals a stable promoter holding of 59.32% that has remained unchanged over the past five quarters through December 2025. The three key promoter entities—Mn Ventures Private Limited (56.09%), Nextwave Communications Private Limited (3.03%), and Mahendra Nahata (0.21%)—have maintained their stakes, indicating confidence in the long-term prospects or, alternatively, limited ability to find buyers at acceptable valuations. Positively, there is no promoter pledging, eliminating concerns about forced selling or margin calls.
| Quarter | Promoter % | FII % | MF % | Insurance % | Non-Institutional % |
|---|---|---|---|---|---|
| Dec'25 | 59.32 | 0.00 | 0.00 | 0.00 | 40.67 |
| Sep'25 | 59.32 | 0.00 | 0.00 | 0.00 | 40.67 |
| Jun'25 | 59.32 | 0.00 | 0.00 | 0.00 | 40.67 |
| Mar'25 | 59.32 | 0.01 | 0.00 | 0.00 | 40.67 |
| Dec'24 | 59.32 | 0.00 | 0.00 | 0.00 | 40.68 |
The concerning aspect of the shareholding structure is the complete absence of institutional participation. Foreign institutional investors (FIIs) hold 0.00%, mutual funds hold 0.00%, and insurance companies hold 0.00% as of December 2025. A solitary FII held a negligible 0.01% stake in March 2025 but has since exited. This zero institutional holding signals that professional fund managers and institutional analysts have found insufficient merit in the company's fundamentals, growth prospects, or governance to warrant investment.
The non-institutional holding of 40.67% comprises primarily retail investors and other non-institutional entities. The stable nature of this holding over recent quarters suggests limited trading activity and possibly a captive shareholder base. However, the absence of sophisticated institutional investors means the stock lacks the research coverage, liquidity, and credibility that institutional participation typically brings, further limiting its appeal to broader investor segments.
Stock Performance: Severe Underperformance Across All Timeframes
Media Matrix Worldwide's stock performance has been dismal across virtually all time horizons, with the stock generating negative alpha versus the Sensex in all periods except the five-year timeframe. The one-year return of negative 31.40% compares unfavourably to the Sensex's 9.01% gain, resulting in negative alpha of 40.41 percentage points. The two-year performance is even more troubling, with the stock declining 57.71% while the Sensex advanced 17.71%, creating a performance gap of 75.42 percentage points.
| Period | Stock Return | Sensex Return | Alpha |
|---|---|---|---|
| 1 Week | +1.94% | +0.64% | +1.30% |
| 1 Month | +4.07% | +0.83% | +3.24% |
| 3 Months | -24.44% | +0.88% | -25.32% |
| 6 Months | -41.68% | +5.53% | -47.21% |
| YTD | -5.12% | -1.11% | -4.01% |
| 1 Year | -31.40% | +9.01% | -40.41% |
| 2 Years | -57.71% | +17.71% | -75.42% |
| 3 Years | -24.44% | +38.88% | -63.32% |
| 5 Years | +80.19% | +64.25% | +15.94% |
The stock's risk-adjusted return for the one-year period stands at negative 0.59, indicating that investors have been penalised rather than rewarded for taking on the stock's volatility. With a volatility of 53.14%—nearly five times the Sensex's 11.54%—the stock falls into the "HIGH RISK LOW RETURN" category, the worst possible combination for investors. The beta of 1.50 classifies it as a high-beta stock, meaning it tends to amplify market movements, creating larger losses during downturns without commensurate gains during rallies.
Technical indicators uniformly point to bearish sentiment. The stock trades below all key moving averages—5-day (₹9.38), 20-day (₹9.04), 50-day (₹9.93), 100-day (₹10.88), and 200-day (₹12.38)—indicating sustained selling pressure and lack of buying interest. The MACD, RSI, Bollinger Bands, and KST indicators all flash bearish signals on both weekly and monthly timeframes. The current bearish trend, which began on December 10, 2025, at ₹11.20, has seen the stock decline 13.57% to its current level of ₹9.46, with immediate support at the 52-week low of ₹7.61 and major resistance at the 100-day moving average of ₹10.88.
Investment Thesis: Multiple Red Flags Overshadow Limited Positives
The investment thesis for Media Matrix Worldwide is fundamentally challenged by a confluence of negative factors that overwhelm any potential positives. The company's Mojo score of 31 out of 100 places it firmly in "SELL" territory, reflecting poor performance across valuation, quality, financial trends, and technical parameters. The valuation grade of "EXPENSIVE" indicates the stock is overpriced relative to its fundamentals, while the quality grade of "AVERAGE" suggests mediocre long-term financial performance. The financial trend is classified as "FLAT," indicating stagnant operational momentum, and the technical trend remains decisively "BEARISH."
The company's operational metrics reveal fundamental weaknesses that limit its investment appeal. The average ROE of 1.41% and average ROCE of 10.90% indicate poor capital efficiency and weak profitability generation. The EBIT-to-interest coverage of just 1.72 times provides minimal cushion for debt servicing, whilst the debt-to-EBITDA ratio of 7.54 times signals high financial leverage. The five-year sales decline of 0.82% annually demonstrates the company's inability to grow its revenue base despite operating in a structurally expanding sector.
Key Strengths & Risk Factors
Key Strengths
- Stable promoter holding of 59.32% with zero pledging indicates long-term commitment
- Positive five-year EBIT growth of 7.36% shows some underlying operational improvement
- Relatively low debt-to-equity ratio of 0.11 compared to some peers
- Recent quarter showed sequential revenue growth of 65.30%
- Book value per share of ₹0.94 provides some asset backing
Key Risk Factors
- Severe revenue volatility with 65.69% year-on-year decline in Q2 FY26
- Extremely weak ROE of 1.41% indicating poor capital utilisation
- Expensive valuation with P/E of 315x and P/BV of 7.98x
- Zero institutional holding signals lack of professional investor confidence
- Compressed margins with PAT margin at just 0.53%
- High debt-to-EBITDA ratio of 7.54 times creates financial vulnerability
- Negative five-year sales growth of 0.82% annually
- Massive underperformance versus sector by 318 percentage points
- Deteriorating balance sheet with shareholder funds declining 60% year-on-year
Outlook: Limited Upside, Substantial Downside Risks
The forward outlook for Media Matrix Worldwide remains challenging across multiple dimensions. The company must demonstrate consistent revenue growth and margin expansion to justify its current valuation, but the track record suggests this is unlikely in the near term. The half-yearly revenue decline of 47.78% for H1 FY26 indicates that the business momentum continues to deteriorate rather than improve. Without a clear strategy to stabilise revenues and enhance profitability, the stock faces continued pressure.
Positive Catalysts to Watch
- Consistent quarter-on-quarter revenue growth for three consecutive quarters
- Operating margin expansion above 2.5% sustained over two quarters
- ROE improvement to double-digit levels
- Entry of institutional investors signalling confidence
- Debt reduction and improved interest coverage ratio
Red Flags to Monitor
- Further sequential revenue decline in upcoming quarters
- Operating margin compression below 1.5%
- Quarterly loss or near-zero profitability
- Increase in promoter pledging or stake reduction
- Rising debt levels or deteriorating interest coverage
- Stock breaking below 52-week low of ₹7.61
The technical setup remains decisively negative, with the stock trading in a confirmed bearish trend and below all major moving averages. The lack of institutional participation and the high volatility profile make the stock unsuitable for risk-averse investors. Even for risk-tolerant investors, the combination of expensive valuation, weak fundamentals, and negative momentum creates an unfavourable risk-reward equation. Any potential recovery would require fundamental business transformation and sustained operational improvement—neither of which appears imminent based on current trends.
The Verdict: Avoid This Value Trap
Score: 31/100
For Fresh Investors: Avoid initiating positions. The combination of expensive valuation (P/E 315x, P/BV 7.98x), weak profitability (ROE 1.41%), erratic revenue patterns, and bearish technical trends creates an unfavourable risk-reward profile. The stock has underperformed its sector by over 318 percentage points in the past year, and zero institutional holding signals lack of professional investor confidence.
For Existing Holders: Consider exiting positions on any relief rallies. The deteriorating fundamentals—including 47.78% half-yearly revenue decline, compressed margins, and weakening balance sheet—suggest further downside risk. The stock's classification as "HIGH RISK LOW RETURN" with negative risk-adjusted returns makes it unsuitable for most portfolios.
Fair Value Estimate: ₹5.50-6.50 (35-42% downside from current levels)
Media Matrix Worldwide exemplifies a classic value trap—appearing cheap on certain metrics but fundamentally challenged by weak business economics, inconsistent execution, and structural headwinds. Until the company demonstrates sustained revenue stability, meaningful margin expansion, and improved capital efficiency, the stock remains a speculative bet rather than a sound investment.
Note- ROCE= (EBIT - Other income)/(Capital Employed - Cash - Current Investments)
⚠️ Investment Disclaimer
This article is for educational and informational purposes only and should not be construed as financial advice. Investors should conduct their own due diligence, consider their risk tolerance and investment objectives, and consult with a qualified financial advisor before making any investment decisions.
