The Bhubaneswar-based company, originally incorporated in May 1989 to engage in shrimp hatchery and sea products business, has effectively ceased operational activities. Its financial statements reveal a stark reality: zero sales revenue across all quarters of FY26, coupled with persistent operating losses that are only partially offset by other income of approximately ₹0.14 crores per quarter.
What makes Suryo Foods particularly concerning for investors is the complete erosion of shareholder value. With negative reserves of ₹6.51 crores against share capital of ₹3.96 crores, the company's shareholder funds stand at negative ₹2.55 crores as of March 2025. This translates to a book value per share of negative ₹6.43, indicating that the company's liabilities exceed its assets by a substantial margin.
Financial Performance: A Non-Operating Entity
The Q3 FY26 results underscore the company's fundamental challenges. Operating profit before depreciation, interest, and tax (excluding other income) stood at negative ₹0.16 crores, the worst quarterly performance in recent periods. This represents pure operational cash burn with no corresponding revenue generation. Employee costs, though minimal at ₹0.02 crores, continue to drain resources without any productive output.
| Quarter | Net Sales | Other Income | Operating Profit (excl OI) | Net Profit |
|---|---|---|---|---|
| Dec'25 | ₹0.00 Cr | ₹0.14 Cr | -₹0.16 Cr | -₹0.06 Cr |
| Sep'25 | ₹0.00 Cr | ₹0.14 Cr | -₹0.06 Cr | ₹0.05 Cr |
| Jun'25 | ₹0.00 Cr | ₹0.14 Cr | -₹0.09 Cr | ₹0.02 Cr |
| Mar'25 | ₹0.00 Cr | ₹0.33 Cr | -₹0.11 Cr | ₹0.21 Cr |
| Dec'24 | ₹0.00 Cr | ₹0.09 Cr | -₹0.04 Cr | -₹0.01 Cr |
| Sep'24 | ₹0.00 Cr | ₹0.10 Cr | -₹0.04 Cr | ₹0.02 Cr |
The quarterly trend reveals erratic profitability entirely dependent on other income fluctuations. In Q4 FY25, the company posted a profit of ₹0.21 crores purely due to elevated other income of ₹0.33 crores. However, with other income normalising to ₹0.14 crores in subsequent quarters, the underlying operational losses have pushed the company back into the red.
Depreciation charges of ₹0.03 crores per quarter continue to erode value from the company's fixed asset base of ₹2.58 crores. With no revenue generation to justify these assets, they represent stranded capital with questionable realisation value. The company's current assets of ₹0.64 crores are insufficient to cover current liabilities of ₹2.19 crores, creating a severe working capital deficit.
⚠️ Critical Solvency Concerns
Suryo Foods exhibits severe financial distress with negative shareholder equity of ₹2.55 crores, negative book value per share of ₹6.43, and current liabilities exceeding current assets by ₹1.55 crores. The company has no operational revenue and relies entirely on other income to partially offset ongoing losses. This represents a fundamentally unsustainable business model with significant risk of complete capital erosion.
The Absence of Business Operations
Perhaps the most alarming aspect of Suryo Foods' financial profile is the complete absence of business operations. The company's original mandate—shrimp hatchery and sea products—appears to have been abandoned years ago. Annual financial statements show sales revenue of just ₹1.00 crore in FY20, declining to zero in subsequent years. Even during FY15-FY20, peak annual sales never exceeded ₹2.00 crores, indicating the business was never viable at scale.
The company attempted diversification into construction and real estate in 2008-09, utilising vacant land in Dhamara, Bhadrak district, Odisha. However, this venture appears to have yielded no meaningful revenue. The Gopalpur hatchery, which commenced operations on April 1, 2015, similarly failed to generate sustainable income streams.
Return on equity stands at 0.0%, reflecting the mathematical impossibility of calculating returns on negative shareholder equity. Return on capital employed, whilst showing an average of 14.33%, is distorted by the negative capital base and should not be interpreted as a positive indicator. The company has no debt, which might appear favourable, but this likely reflects an inability to secure financing rather than prudent capital structure management.
Quality of Earnings: Non-Existent
With zero operating revenue and total dependence on other income, Suryo Foods generates no earnings from core business activities. The other income of ₹0.14 crores per quarter likely represents interest on deposits or asset monetisation, which is inherently unsustainable. The company's "earnings" are merely a slow liquidation of remaining assets, not genuine business profits.
Peer Comparison: Bottom of the Barrel
Even within the struggling micro-cap FMCG space, Suryo Foods stands out for all the wrong reasons. A comparison with similarly distressed peers reveals the extent of underperformance.
| Company | Market Cap | P/E Ratio | P/BV Ratio | ROE | Debt to Equity |
|---|---|---|---|---|---|
| Suryo Foods | ₹9.00 Cr | 32.65x | -3.55x | 0.0% | 0.02 |
| Bansisons Tea | — | NA (Loss Making) | 1.68x | 0.0% | -0.05 |
| Photoquip India | — | 72.40x | 1.25x | 0.35% | 1.02 |
| Jay Kailash | — | 7.98x | 0.50x | 6.54% | 0.25 |
| Super Bakers (I) | — | 19.70x | 1.81x | 0.0% | -0.79 |
Suryo Foods trades at a P/E ratio of 32.65x, which is mathematically questionable given the erratic and unsustainable nature of earnings. More tellingly, the price-to-book value of negative 3.55x indicates the market is pricing the stock at a significant premium to its negative net worth—an irrational valuation that reflects speculative trading rather than fundamental value.
Whilst peer Jay Kailash demonstrates a viable business model with 6.54% ROE and positive book value, Suryo Foods offers no comparable investment merit. Even amongst distressed micro-caps, it ranks at the bottom in terms of business viability and financial health.
Valuation Analysis: Pricing Negative Worth
The current market price of ₹24.02 represents a profound disconnect from underlying fundamentals. With a negative book value of ₹6.43 per share, the stock trades at negative 3.55 times book value, meaning investors are paying ₹24.02 for every ₹6.43 of negative equity. This defies rational valuation principles.
The company's enterprise value to EBITDA ratio of negative 8.78x and EV to capital employed of negative 3.48x further underscore the valuation absurdity. These metrics are mathematically distorted by negative denominators but point to a fundamental truth: the company destroys value rather than creates it.
| Valuation Metric | Current Value | Assessment |
|---|---|---|
| P/E Ratio (TTM) | 32.65x | Unsustainable earnings base |
| Price to Book Value | -3.55x | Pricing negative equity |
| EV/EBITDA | -8.78x | Negative operating profit |
| Market Cap | ₹9.00 Cr | Speculative micro-cap |
| 52-Week Range | ₹13.60 - ₹33.82 | High volatility |
The stock's 52-week range of ₹13.60 to ₹33.82 demonstrates extreme volatility, with the current price 76.62% above the low and 28.98% below the high. This price action reflects speculative trading patterns typical of illiquid micro-caps rather than fundamental value discovery. Daily trading volumes of just 760 shares confirm the illiquidity, making it difficult for investors to exit positions without significant price impact.
"Suryo Foods represents a cautionary tale of capital destruction: a company with no operations, negative equity, and a market valuation that defies financial logic."
Shareholding Pattern: Stable but Concerning
The shareholding structure has remained remarkably stable over recent quarters, though this stability offers little comfort given the underlying business distress.
| Shareholder Category | Sep'25 | Jun'25 | Mar'25 | QoQ Change |
|---|---|---|---|---|
| Promoter Holding | 51.74% | 51.74% | 51.74% | 0.00% |
| Mutual Funds | 2.07% | 2.07% | 2.07% | 0.00% |
| Other DII | 2.20% | 2.20% | 2.20% | 0.00% |
| Non-Institutional | 44.00% | 44.00% | 43.99% | 0.00% |
| FII | 0.00% | 0.00% | 0.00% | 0.00% |
Promoter holding stands at 51.74%, with Suryo Udyog Limited controlling 47.36% and individual promoters holding the balance. The absence of any pledging is noteworthy, though this likely reflects the unmarketable nature of the shares rather than financial strength. Institutional holding totals just 4.26%, with two mutual funds holding 2.07% and other domestic institutional investors at 2.20%. The complete absence of foreign institutional interest speaks volumes about the company's investment grade.
The stability in shareholding—with zero quarter-on-quarter changes across all categories—suggests shareholders are either trapped in illiquid positions or waiting for some form of corporate action. The 44.00% non-institutional holding represents retail investors who may be unaware of the fundamental deterioration or hoping for a speculative rebound.
Stock Performance: Volatility Without Fundamentals
Despite abysmal fundamentals, Suryo Foods has delivered extraordinary returns over longer timeframes, though recent performance has moderated significantly.
| Period | Stock Return | Sensex Return | Alpha |
|---|---|---|---|
| 1 Day | +4.66% | -0.39% | +5.05% |
| 1 Week | -7.01% | -0.75% | -6.26% |
| 1 Month | -12.01% | -1.98% | -10.03% |
| 3 Months | +20.04% | -0.84% | +20.88% |
| 6 Months | +50.13% | +1.82% | +48.31% |
| 1 Year | +45.93% | +8.65% | +37.28% |
| 3 Years | +113.13% | +36.79% | +76.34% |
| 5 Years | +253.24% | +68.52% | +184.72% |
The one-year return of 45.93% significantly outpaces the Sensex gain of 8.65%, generating alpha of 37.28%. Over five years, the stock has delivered a staggering 253.24% return versus Sensex's 68.52%, though this performance is entirely disconnected from business fundamentals. The year-to-date decline of 24.47% suggests the speculative momentum may be waning.
With a beta of 1.50, Suryo Foods exhibits 50% higher volatility than the broader market. The stock's risk-adjusted return of 0.61 over one year, whilst positive, comes with extreme volatility of 75.81%—more than six times the Sensex volatility of 11.31%. This classifies the stock as "high risk, high return," though the risk component is far more certain than the return prospect.
Technical Outlook: Bearish Signals Emerging
Technical indicators paint a deteriorating picture. The stock currently trades below all key moving averages: 5-day MA at ₹24.65, 20-day MA at ₹28.03, 50-day MA at ₹27.82, 100-day MA at ₹24.26, and 200-day MA at ₹20.87. This alignment suggests weakening momentum after the recent speculative run-up.
The overall technical trend has shifted to "mildly bullish" from "bullish" on January 9, 2026, indicating momentum loss. Weekly MACD shows mildly bearish signals, whilst Dow Theory on weekly charts is mildly bearish. Only the monthly KST and MACD remain bullish, but these longer-term indicators lag price action.
Immediate support lies at the 52-week low of ₹13.60, whilst resistance clusters around the 20-day moving average at ₹28.03. The 43.44% decline from the 52-week high of ₹33.82 to current levels suggests profit-taking by speculative traders who drove the earlier rally.
Investment Thesis: No Fundamental Case
The proprietary Mojo Score of 33 out of 100 places Suryo Foods firmly in "SELL" territory, and this rating is generous given the fundamental realities. The company fails on virtually every investment parameter:
Valuation: Classified as "RISKY" with negative book value and unsustainable earnings. The stock trades at a premium to negative equity, which is financially irrational.
Quality: Graded "BELOW AVERAGE" with zero revenue generation, negative ROE, negative book value, and no viable business operations. The company destroys rather than creates shareholder value.
Financial Trend: Marked as "FLAT" but deteriorating, with Q3 FY26 showing the worst operating losses in recent quarters. The trend is actually negative when adjusted for the unsustainable nature of other income.
Technical Trend: "MILDLY BULLISH" but weakening, with the stock trading below all major moving averages and showing bearish divergences on multiple indicators.
Key Strengths
✓ No Debt Burden: Zero debt eliminates bankruptcy risk in the near term, though this reflects inability to secure financing rather than financial prudence.
✓ No Promoter Pledging: Promoters have not pledged shares, suggesting they retain nominal confidence or simply cannot pledge unmarketable securities.
✓ Stable Shareholding: No significant shareholder exits in recent quarters, though this may indicate trapped positions rather than conviction.
✓ Historical Price Gains: Long-term holders have seen significant appreciation, though this is purely speculative and disconnected from fundamentals.
Key Concerns
⚠️ Zero Operating Revenue: Complete absence of business operations for multiple years with no turnaround plan visible.
⚠️ Negative Shareholder Equity: Book value of negative ₹6.43 per share indicates liabilities exceed assets by ₹2.55 crores.
⚠️ Unsustainable Earnings: Total dependence on other income of ₹0.14 crores per quarter, which cannot offset operational losses indefinitely.
⚠️ Deteriorating Quarterly Performance: Q3 FY26 showed worst operating losses at negative ₹0.16 crores before other income.
⚠️ Working Capital Deficit: Current liabilities of ₹2.19 crores exceed current assets of ₹0.64 crores, creating solvency risk.
⚠️ Extreme Illiquidity: Daily volumes of just 760 shares make exit difficult without significant price impact.
⚠️ Irrational Valuation: Market cap of ₹9.00 crores for a company with negative equity and no operations defies logic.
Outlook: What to Watch
Positive Catalysts (Highly Unlikely)
Business Restart: Resumption of shrimp hatchery or sea products operations with sustainable revenue generation.
Asset Monetisation: Sale of fixed assets or land holdings to improve liquidity and reduce losses.
Merger or Acquisition: Corporate action that provides exit opportunity for shareholders at fair value.
Capital Infusion: Fresh equity to restart operations and improve financial position, though highly improbable.
Red Flags to Monitor
Continued Revenue Absence: Further quarters with zero sales confirming permanent business cessation.
Other Income Decline: Reduction in other income below ₹0.14 crores would accelerate losses and equity erosion.
Liquidity Crisis: Inability to meet current liabilities leading to potential insolvency proceedings.
Promoter Exit: Any reduction in promoter holding would signal complete loss of confidence.
Delisting Risk: Failure to meet exchange listing requirements due to minimal operations or price manipulation concerns.
The Verdict: Avoid at All Costs
Score: 33/100
For Fresh Investors: Do not invest under any circumstances. Suryo Foods has no operating business, negative shareholder equity, and an irrational valuation that prices ₹24.02 for every ₹6.43 of negative net worth. The stock represents pure speculation with extreme downside risk and no fundamental support. Any capital deployed here is likely to result in permanent loss.
For Existing Holders: Exit immediately at current prices whilst liquidity exists. The recent 4.66% uptick provides a window to reduce positions before further deterioration. With zero revenue, negative equity, and worsening quarterly losses, the company is on a path to complete capital erosion. The 45.93% one-year gain is purely speculative and unsustainable—book profits before they evaporate.
Fair Value Estimate: ₹0.00 (100% downside from current ₹24.02). With negative book value and no business operations, the company has no intrinsic value. The current market price represents speculative trading divorced from reality.
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. The analysis presented is based on publicly available financial data and does not constitute a recommendation to buy, sell, or hold securities. Past performance is not indicative of future results, and all investments carry risk of loss.
