Baroda Extrusion Ltd is Rated Hold by MarketsMOJO

Current Rating and Its Significance

MarketsMOJO’s 'Hold' rating for Baroda Extrusion Ltd indicates a neutral stance on the stock, suggesting that investors should neither aggressively buy nor sell at this juncture. This rating reflects a balance between the company’s strengths and challenges, signalling that while the stock may offer moderate returns, it does not currently present a compelling opportunity for significant gains or losses. The rating was revised from 'Sell' to 'Hold' on 13 January 2026, following an improvement in the company’s overall mojo score from 47 to 58, signalling a more stable outlook.

Here’s How Baroda Extrusion Ltd Looks Today

As of 16 February 2026, Baroda Extrusion Ltd is classified as a microcap company operating within the Industrial Products sector. The stock has experienced mixed price movements recently, with a one-day decline of 2.6%, but showing a positive year-to-date return of 9.08% and a one-year gain of 18.95%. Over the past six months, the stock has appreciated by 31.84%, reflecting some resilience amid market fluctuations.

Quality Assessment

The company’s quality grade is assessed as average. This is primarily due to its modest profitability metrics. The Return on Capital Employed (ROCE) stands at 5.45%, indicating limited efficiency in generating profits from the capital invested. Similarly, the Return on Equity (ROE) is 6.10%, which is relatively low and suggests that shareholder funds are not being optimally utilised. Despite these figures, Baroda Extrusion has demonstrated consistent operational performance, declaring positive results for five consecutive quarters. The latest quarterly PBDIT reached Rs 3.01 crores, with an operating profit margin of 6.79%, signalling steady earnings generation.

Valuation Considerations

Valuation remains a key factor in the current rating, with the company graded as expensive. The stock trades at an enterprise value to capital employed ratio of 8, which is higher than typical benchmarks for its sector peers. This elevated valuation suggests that investors are pricing in expectations of future growth or operational improvements. However, the stock is trading at a discount relative to its peers’ historical valuations, which may offer some cushion. The price-to-earnings growth (PEG) ratio is effectively zero, reflecting the company’s significant profit growth over the past year, which has surged by 635%.

Financial Trend Analysis

Financially, Baroda Extrusion Ltd shows a positive trend. Net sales have grown at an annualised rate of 30.33%, while operating profit has expanded even more robustly at 53.92%. This strong top-line and bottom-line growth underpin the company’s improving fundamentals. However, the company’s debt servicing capacity is a concern, with a high Debt to EBITDA ratio of 25.33 times, indicating significant leverage and potential risk in meeting debt obligations. Investors should weigh this financial risk against the growth trajectory when considering the stock.

Technical Outlook

From a technical perspective, the stock exhibits a mildly bullish stance. Recent price movements over three months show a 21.02% gain, and the six-month trend is even more positive. Despite a short-term dip of 17.47% over the past month, the overall momentum suggests moderate investor confidence. The technical grade supports the 'Hold' rating, implying that while the stock is not in a strong uptrend, it is not in a downtrend either, making it suitable for investors seeking stability rather than aggressive growth.

Implications for Investors

For investors, the 'Hold' rating on Baroda Extrusion Ltd suggests a cautious approach. The company’s steady growth in sales and profits, combined with positive quarterly results, indicate operational stability. However, the relatively low returns on capital and equity, coupled with high leverage, temper enthusiasm. The expensive valuation further implies that the market has priced in expectations of continued growth, which may limit upside potential in the near term.

Investors should monitor the company’s ability to manage its debt levels and improve capital efficiency. Those with a moderate risk appetite may consider maintaining existing positions, while more risk-averse investors might prefer to wait for clearer signs of financial strengthening or valuation moderation before increasing exposure.

Summary

In summary, Baroda Extrusion Ltd’s current 'Hold' rating by MarketsMOJO reflects a balanced view of its prospects as of 16 February 2026. The company demonstrates solid growth trends and positive technical signals, but faces challenges in profitability and debt management. The rating advises investors to maintain a neutral stance, recognising both the opportunities and risks inherent in the stock’s current profile.

About MarketsMOJO Ratings

MarketsMOJO’s ratings are derived from a comprehensive analysis of multiple parameters including quality, valuation, financial trends, and technical indicators. The 'Hold' rating is assigned when a stock exhibits a mix of strengths and weaknesses, suggesting that investors should neither aggressively buy nor sell but rather monitor developments closely. This approach helps investors make informed decisions based on a holistic view of the company’s fundamentals and market behaviour.

Stock Performance Snapshot as of 16 February 2026

Baroda Extrusion Ltd’s stock returns over various periods highlight its recent volatility and growth potential:

• 1 Day: -2.60%
• 1 Week: +7.16%
• 1 Month: -17.47%
• 3 Months: +21.02%
• 6 Months: +31.84%
• Year-to-Date: +9.08%
• 1 Year: +18.95%

These figures illustrate the stock’s mixed short-term performance but overall positive momentum over longer periods.

Financial Highlights

Key financial metrics as of today include:

• Return on Capital Employed (ROCE): 5.45%
• Return on Equity (ROE): 6.10%
• Debt to EBITDA Ratio: 25.33 times
• Annual Net Sales Growth: 30.33%
• Annual Operating Profit Growth: 53.92%
• Quarterly PBDIT: Rs 3.01 crores (highest)
• Operating Profit Margin (Quarterly): 6.79% (highest)

These data points provide a detailed picture of the company’s operational and financial health, supporting the rationale behind the current rating.

Conclusion

Baroda Extrusion Ltd’s 'Hold' rating reflects a nuanced assessment of its current standing. Investors should consider the company’s growth prospects alongside its financial constraints and valuation levels. Maintaining a watchful eye on debt management and profitability improvements will be crucial in determining future investment decisions. For now, the stock remains a moderate option within the Industrial Products sector, suitable for investors seeking balanced exposure rather than aggressive growth.

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