Andrew Yule & Company Ltd is Rated Strong Sell

Understanding the Current Rating

The Strong Sell rating assigned to Andrew Yule & Company Ltd indicates a cautious stance for investors, signalling that the stock is expected to underperform relative to the broader market and its sector peers. This recommendation is derived from a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. Each of these factors contributes to the overall assessment of the company’s investment appeal and risk profile.

Quality Assessment

As of 23 January 2026, Andrew Yule & Company Ltd’s quality grade remains below average. The company has struggled with operational inefficiencies and weak long-term fundamentals. Over the past five years, operating profit has declined at an alarming annualised rate of -240.14%, signalling persistent challenges in generating sustainable earnings. Additionally, the company’s ability to service debt is notably poor, with an average EBIT to interest ratio of -6.46, indicating that earnings before interest and taxes are insufficient to cover interest expenses. This weak financial health undermines investor confidence and contributes to the negative quality grading.

Valuation Considerations

The valuation grade for Andrew Yule & Company Ltd is classified as risky. Despite the stock’s small market capitalisation within the FMCG sector, its current trading multiples suggest elevated risk relative to historical norms. The company’s negative EBITDA further exacerbates valuation concerns, as it implies operational losses at the core business level. Over the past year, the stock has delivered a return of -44.88%, reflecting significant investor caution. Interestingly, profits have risen by 122.3% during the same period, resulting in a PEG ratio of 1.8, which suggests that earnings growth is not yet fully reflected in the stock price. Nonetheless, the overall valuation remains unattractive given the underlying financial instability.

Financial Trend and Recent Performance

Financially, Andrew Yule & Company Ltd exhibits a flat trend, with recent quarterly results underscoring ongoing difficulties. The latest quarterly net sales stood at ₹71.52 crores, representing a decline of 20.02% compared to previous periods. Profit before tax excluding other income fell sharply by 398.31% to a loss of ₹10.62 crores, while the net profit after tax was nearly nil at a loss of ₹0.02 crores, down 100.1%. These figures highlight the company’s inability to generate consistent profitability and revenue growth. Furthermore, the stock’s performance over various time frames has been disappointing: a 1-month decline of 7.35%, a 3-month drop of 16.64%, and a 6-month fall of 28.42%. Year-to-date, the stock is down 5.86%, and over the past year, it has lost 44.88% in value. This underperformance extends to longer horizons as well, with the stock lagging the BSE500 index over the last three years, one year, and three months.

Technical Outlook

The technical grade for Andrew Yule & Company Ltd is bearish, reflecting negative momentum and weak price action. The stock’s recent day change of -0.23% and weekly decline of 2.60% reinforce the downward trend. Technical indicators suggest limited near-term recovery potential, which aligns with the broader fundamental challenges facing the company. This bearish technical stance serves as a cautionary signal for investors considering entry or holding positions in the stock.

Additional Market Insights

Despite its presence in the FMCG sector, Andrew Yule & Company Ltd has attracted minimal interest from domestic mutual funds, which currently hold 0% of the company’s shares. Given that mutual funds typically conduct thorough research and favour companies with strong fundamentals and growth prospects, their absence may indicate concerns about the company’s valuation or business model. This lack of institutional support further weighs on the stock’s outlook.

What the Strong Sell Rating Means for Investors

For investors, the Strong Sell rating on Andrew Yule & Company Ltd serves as a clear warning to exercise caution. It suggests that the stock is expected to continue underperforming due to weak fundamentals, risky valuation, flat financial trends, and bearish technical signals. Investors should carefully consider the risks of holding or acquiring shares in this company, especially given its operational losses and poor debt servicing capability.

While some earnings growth has been noted recently, it has not translated into positive returns or improved market sentiment. The absence of institutional backing and the stock’s persistent underperformance relative to benchmarks further reinforce the need for prudence. Investors seeking exposure to the FMCG sector may find more attractive opportunities elsewhere, particularly in companies demonstrating stronger quality metrics and healthier financial trends.

Summary

In summary, Andrew Yule & Company Ltd’s current Strong Sell rating by MarketsMOJO, updated on 04 Nov 2024, reflects a comprehensive assessment of its ongoing challenges. As of 23 January 2026, the company’s below-average quality, risky valuation, flat financial trend, and bearish technical outlook combine to present a high-risk investment profile. This rating advises investors to approach the stock with caution and to prioritise more fundamentally sound alternatives within the FMCG sector or broader market.

Key Metrics at a Glance (As of 23 January 2026):

• Mojo Score: 12.0 (Strong Sell)
• Market Capitalisation: Smallcap
• 1-Year Stock Return: -44.88%
• Operating Profit Growth (5 years annualised): -240.14%
• EBIT to Interest Ratio (average): -6.46
• Quarterly Net Sales: ₹71.52 crores (-20.02%)
• Quarterly PBT less Other Income: -₹10.62 crores (-398.31%)
• Quarterly PAT: -₹0.02 crores (-100.1%)

Investors should monitor these metrics closely and consider the broader market context before making investment decisions regarding Andrew Yule & Company Ltd.

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