The Mumbai-based realty developer, trading at ₹29.98 as of February 13, 2026, has witnessed its share price plummet 73.93% from its 52-week high of ₹115.00, even as it reported record quarterly revenues and profits. The company's promoters, led by Jatin Dhansukhlal Suratwala with a 38.70% stake, maintain a stable 73.39% collective holding with zero pledging—a reassuring sign of management confidence despite the stock's precipitous decline.
Financial Performance: Explosive Growth from Low Base
Suratwwala Business Group's Q3 FY26 performance represents a dramatic inflection point. Net sales surged to ₹42.09 crores, marking a 62.01% quarter-on-quarter increase and an extraordinary 1,223.58% year-on-year jump. This stellar topline expansion translated into operating profit (PBDIT excluding other income) of ₹15.49 crores, yielding a healthy 36.80% margin. Net profit of ₹11.13 crores delivered a PAT margin of 26.44%, demonstrating strong operational efficiency despite the rapid revenue scaling.
| Quarter | Revenue (₹ Cr) | QoQ Growth | Net Profit (₹ Cr) | QoQ Growth | PAT Margin |
|---|---|---|---|---|---|
| Dec'25 (Q3 FY26) | 42.09 | +62.01% | 11.13 | +36.40% | 26.44% |
| Sep'25 (Q2 FY26) | 25.98 | +62.88% | 8.16 | +53.10% | 31.41% |
| Jun'25 (Q1 FY26) | 15.95 | -25.71% | 5.33 | -18.38% | 33.42% |
| Mar'25 (Q4 FY25) | 21.47 | +575.16% | 6.53 | +3,336.84% | 30.41% |
| Dec'24 (Q3 FY25) | 3.18 | +41.96% | 0.19 | -13.64% | 5.97% |
| Sep'24 (Q2 FY25) | 2.24 | -74.37% | 0.22 | -94.62% | 9.82% |
| Jun'24 (Q1 FY25) | 8.74 | — | 4.09 | — | 46.80% |
The nine-month performance for FY26 (April-December 2025) reveals cumulative revenue of ₹84.02 crores with net profit of ₹24.62 crores, representing substantial improvement over the comparable period. However, the lumpy nature of realty revenue recognition—evident in the volatile quarterly patterns—underscores the project-driven business model where revenue realisation depends on construction milestones and booking conversions.
Operational Excellence: Strong Returns Despite Historical Volatility
Suratwwala Business Group's capital efficiency metrics paint an impressive picture. The company's average return on equity of 44.70% ranks amongst the strongest in its peer group, demonstrating superior profitability relative to shareholder capital. This exceptional ROE reflects both operational efficiency and prudent capital allocation, with the latest ROE standing at 24.62%. The average return on capital employed (ROCE) of 31.48%, though moderating to 18.84% in the most recent period, still indicates healthy returns on deployed capital.
The balance sheet reveals a company in expansion mode. Fixed assets surged from ₹1.07 crores in March 2024 to ₹21.30 crores by March 2025, indicating significant capital investment in projects. Long-term debt increased substantially to ₹64.57 crores from ₹5.03 crores, funding this growth trajectory. However, the debt-to-EBITDA ratio remains manageable at 1.17 times, and the company maintains negative net debt on average, suggesting adequate cash generation capabilities relative to borrowings.
⚠️ Key Concern: Lumpy Revenue and Working Capital Pressure
The realty sector's project-based revenue model creates inherent volatility. Cash flow from operations turned negative at ₹4.00 crores in FY25 due to working capital absorption of ₹18.00 crores, highlighting the capital-intensive nature of property development. The debtors turnover ratio declining to 4.60 times on a half-yearly basis signals potential delays in receivable collections—a critical metric for cash-strapped developers.
The Valuation Paradox: Premium Multiples Meet Structural Concerns
Suratwwala Business Group trades at a price-to-earnings ratio of 26.00 times trailing twelve-month earnings, representing a 31.58% discount to the industry average of 38.00 times. However, the price-to-book value of 6.28 times appears stretched, particularly when considering the company's book value per share of just ₹3.96. The EV-to-EBITDA multiple of 21.61 times and EV-to-sales of 8.53 times suggest the market is pricing in continued strong growth—a risky assumption given the company's historical volatility.
The company's "Very Expensive" valuation grade reflects these elevated multiples. With a PEG ratio of 1.11, the stock trades slightly above the theoretical fair value of 1.0, indicating growth expectations may already be fully priced in. The modest dividend yield of 0.34% offers little income support, whilst the zero dividend payout ratio suggests management is prioritising growth investments over shareholder distributions.
Critical Insight: Growth from a Low Base
The spectacular year-on-year growth figures—whilst impressive on paper—must be contextualised against the exceptionally weak base of Q3 FY25, when net profit was merely ₹0.19 crores. The company's five-year sales growth of -10.37% and EBIT growth of -17.02% reveal a longer-term decline that the recent quarters have only begun to reverse. Sustainable recovery requires consistent execution across multiple quarters, not just one-off project completions.
Peer Comparison: Superior Returns, Premium Valuation
| Company | P/E (TTM) | P/BV | ROE (%) | Debt/Equity | Div Yield (%) |
|---|---|---|---|---|---|
| Suratwwala Business | 25.53 | 6.28 | 44.70 | 0.63 | 0.34 |
| B-Right Real | 227.24 | 4.82 | 2.17 | 0.54 | — |
| Modi's Navnirman | 52.33 | 5.46 | 11.63 | -0.01 | — |
| GeeCee Ventures | 27.85 | 0.75 | 3.98 | -0.61 | — |
| Nila Spaces | 23.88 | 3.74 | 5.58 | 0.18 | — |
| PropshareТitania | 96.05 | 10.75 | 61.81 | 1.33 | 1.93 |
Suratwwala Business Group's 44.70% ROE significantly outpaces most peers, trailing only PropshareТitania's exceptional 61.81%. This superior return profile partially justifies the elevated 6.28 times price-to-book ratio, though it remains below PropshareТitania's 10.75 times. The company's moderate P/E of 25.53 times appears reasonable compared to B-Right Real's stratospheric 227.24 times, suggesting the market recognises the operational improvements whilst remaining cautious about sustainability.
Shareholding Pattern: Stable Promoter Base, Minimal Institutional Interest
| Quarter | Promoter (%) | FII (%) | MF (%) | Insurance (%) | Non-Inst (%) |
|---|---|---|---|---|---|
| Dec'25 | 73.39 | 0.01 | 0.00 | 0.00 | 26.60 |
| Sep'25 | 73.39 | 0.00 | 0.00 | 0.00 | 26.61 |
| Jun'25 | 73.39 | 0.01 | 0.00 | 0.00 | 26.60 |
| Mar'25 | 73.39 | 0.05 | 0.00 | 0.00 | 26.56 |
| Dec'24 | 73.39 | 0.30 | 0.00 | 0.00 | 26.30 |
The shareholding pattern reveals unwavering promoter commitment, with the founding group maintaining a steady 73.39% stake across five consecutive quarters and zero pledging. However, foreign institutional investor (FII) holdings have dwindled from 0.30% in December 2024 to a negligible 0.01% by December 2025, reflecting diminishing institutional confidence. The complete absence of mutual fund and insurance company holdings—combined with total institutional ownership of merely 0.01%—underscores the stock's illiquidity and limited institutional endorsement.
Stock Performance: Brutal Decline Despite Operational Recovery
| Period | Stock Return (%) | Sensex Return (%) | Alpha (%) |
|---|---|---|---|
| 1 Week | -5.49 | -0.87 | -4.62 |
| 1 Month | -15.72 | -0.92 | -14.80 |
| 3 Months | -6.34 | -1.92 | -4.42 |
| 6 Months | -28.64 | +2.88 | -31.52 |
| YTD | -14.81 | -2.77 | -12.04 |
| 1 Year | -72.50 | +8.82 | -81.32 |
| 2 Years | -59.98 | +15.79 | -75.77 |
| 3 Years | +37.52 | +37.11 | +0.41 |
The stock's price action tells a sobering story. Despite the operational turnaround, Suratwwala Business Group has delivered a catastrophic -72.50% return over the past year, massively underperforming the Sensex's +8.82% gain by 81.32 percentage points. The stock trades 73.93% below its 52-week high of ₹115.00, with all key moving averages (5-day, 20-day, 50-day, 100-day, and 200-day) now acting as resistance levels. The bearish technical trend, which commenced on November 3, 2025, reflects persistent selling pressure despite improving fundamentals.
The risk-adjusted return profile is equally concerning. With volatility of 56.33%—nearly five times the Sensex's 11.46%—and a negative Sharpe ratio, the stock falls into the "high risk, low return" category. The adjusted beta of 1.50 indicates the stock amplifies market movements by 50%, making it particularly vulnerable during market downturns. Trading volumes remain anaemic, with just 199 shares changing hands on February 13, 2026, highlighting severe liquidity constraints.
Investment Thesis: Outstanding Financials Meet Bearish Technicals
The investment case for Suratwwala Business Group presents a classic conflict between fundamental improvement and market sentiment. The company's Mojo score of 52 out of 100 reflects this dichotomy: an "Outstanding" financial trend grade acknowledges the record quarterly performance, whilst the "Bearish" technical assessment and "Very Expensive" valuation grade temper enthusiasm. The "Average" quality grade recognises strong return metrics but flags the negative five-year growth trajectory.
Key Strengths & Risk Factors
| ✅ Key Strengths | ⚠️ Key Concerns |
|---|---|
| Exceptional ROE: 44.70% average return on equity demonstrates superior capital efficiency and profitability relative to shareholder funds | Severe Stock Decline: 72.50% drop over past year despite operational improvements signals deep market scepticism |
| Record Quarterly Performance: Q3 FY26 revenue of ₹42.09 crores and net profit of ₹11.13 crores represent all-time highs | Negative Long-term Growth: Five-year sales CAGR of -10.37% and EBIT CAGR of -17.02% reveal structural challenges |
| Strong Interest Coverage: EBIT-to-interest ratio of 25.02 times indicates robust debt servicing capability | Bearish Technical Trend: Stock trading below all key moving averages with persistent selling pressure since November 2025 |
| Zero Promoter Pledging: Stable 73.39% promoter holding with no encumbrances demonstrates management confidence | Minimal Institutional Support: Total institutional holding of just 0.01% reflects lack of professional investor confidence |
| Healthy Operating Margins: 36.80% operating margin in Q3 FY26 demonstrates pricing power and cost control | Severe Illiquidity: Trading volumes of just 199 shares create significant exit risk for investors |
| Manageable Leverage: Debt-to-EBITDA of 1.17 times and negative net debt on average indicate prudent financial management | Working Capital Pressure: Negative operating cash flow of ₹4.00 crores in FY25 and declining debtors turnover raise liquidity concerns |
| Expanding Asset Base: Fixed assets increased from ₹1.07 crores to ₹21.30 crores, indicating growth investments | Premium Valuation: P/BV of 6.28 times and EV/EBITDA of 21.61 times appear expensive given historical volatility |
Outlook: What Lies Ahead
| Positive Catalysts | Red Flags |
|---|---|
| Sustained revenue growth across consecutive quarters demonstrating project execution capabilities | Continued stock price weakness despite strong results indicating fundamental market concerns |
| Margin expansion above 35% on sustained basis validating pricing power and operational efficiency | Further deterioration in working capital or cash flow from operations signalling liquidity stress |
| Institutional investor participation and improved free float liquidity enhancing market credibility | Revenue reverting to lumpy patterns or declining sequentially indicating project completion gaps |
| New project launches and pre-sales momentum providing forward revenue visibility | Rising debt levels without corresponding EBITDA growth deteriorating coverage ratios |
| Technical trend reversal with stock reclaiming key moving averages on strong volumes | Promoter stake dilution or any pledging of shares raising governance concerns |
The Verdict: Impressive Turnaround Insufficient to Overcome Structural Concerns
Score: 52/100
For Fresh Investors: Avoid initiating positions despite impressive quarterly numbers. The 72.50% stock decline, bearish technical trend, severe illiquidity, and negative five-year growth trajectory present excessive risk. Wait for sustained multi-quarter performance, technical trend reversal, and improved institutional participation before considering entry.
For Existing Holders: Maintain positions if acquired at significantly lower levels, but avoid averaging down. Monitor Q4 FY26 results closely for revenue sustainability. Consider partial profit booking if stock rebounds to ₹35-40 levels. Exit completely if quarterly revenue falls below ₹30 crores or margins compress below 30%.
Fair Value Estimate: ₹32-35 (7-17% upside from current levels) based on sustainable earnings of ₹1.40-1.50 per share and justified P/E of 22-24 times given sector volatility and execution risks.
The spectacular Q3 FY26 results demonstrate Suratwwala Business Group's operational capabilities, but one quarter does not constitute a sustainable turnaround. The realty sector's project-driven volatility, combined with the company's historical growth challenges and current market scepticism, warrants caution. Only consistent execution across multiple quarters, accompanied by improved cash flows and institutional endorsement, would justify a more constructive stance.
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.
