Quality Assessment: Weak Long-Term Fundamentals
Bazel International’s quality metrics remain underwhelming, with a persistently low Return on Equity (ROE) averaging just 2.04%. This figure is significantly below industry averages for NBFCs, signalling limited profitability and inefficient capital utilisation. The company’s quarterly financials for Q3 FY25-26 further underscore this weakness, reporting a PBDIT of merely ₹0.31 crore and an EPS of ₹0.55, both at their lowest levels in recent periods. Such flat financial results indicate a lack of growth momentum and raise questions about the company’s ability to generate sustainable earnings.
Moreover, the company’s shareholder base is predominantly non-institutional, which may imply limited strategic investment and oversight from large, professional investors. This factor can contribute to increased volatility and reduced confidence in the stock’s prospects.
Valuation: Attractive but Potentially Misleading
Despite the weak fundamentals, Bazel International trades at a notably low Price to Book (P/B) ratio of 0.4, suggesting the stock is undervalued relative to its book value. This valuation discount is significant when compared to peers within the NBFC sector, many of which trade at higher multiples reflecting better growth and profitability prospects.
However, the low valuation appears to be a reflection of the market’s cautious stance given the company’s deteriorating financial trends and technical outlook. Investors should be wary that the attractive price may be justified by the underlying risks, including declining profitability and negative returns over the past year.
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Financial Trend: Flat to Negative Performance
The company’s financial trend has been largely stagnant, with flat quarterly results and a downward trajectory in profitability. Over the past year, Bazel International’s profits have declined by 27.1%, a significant contraction that has weighed heavily on investor sentiment. The stock’s return over the last 12 months stands at -15.44%, underperforming the BSE500 index and the broader Sensex, which posted a positive 10.6% return over the same period.
Longer-term returns present a mixed picture. While the stock has generated a 56.76% return over three years, this still lags behind the Sensex’s 39.74% gain, and the five- and ten-year returns are not available for comparison. The recent underperformance and shrinking profits highlight the challenges Bazel International faces in regaining investor confidence and delivering consistent growth.
Technical Analysis: Bearish Signals Dominate
The downgrade to Strong Sell is heavily influenced by a marked deterioration in technical indicators. The technical grade shifted from mildly bearish to outright bearish, reflecting increased selling pressure and negative momentum. Key technical metrics include:
- MACD: Weekly readings are bearish, with monthly trends mildly bearish, indicating weakening momentum.
- RSI: Both weekly and monthly Relative Strength Index readings show no clear signal, suggesting indecision but no bullish reversal.
- Bollinger Bands: Weekly bands are bearish, with monthly bands mildly bearish, signalling price volatility skewed to the downside.
- Moving Averages: Daily moving averages are bearish, confirming short-term downtrends.
- KST (Know Sure Thing): Weekly readings are bearish, with monthly mildly bearish, reinforcing negative momentum.
- Dow Theory: Weekly trend is mildly bullish but overshadowed by a mildly bearish monthly trend, indicating mixed but predominantly negative signals.
These technical factors culminated in a sharp price drop of 14.76% on the latest trading day, with the stock closing at ₹29.00, down from a previous close of ₹34.02. The 52-week high stands at ₹45.50, while the low is ₹25.03, placing the current price near the lower end of its annual range and underscoring the bearish sentiment.
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Comparative Performance and Market Context
When benchmarked against the Sensex, Bazel International’s performance is notably weak. Over the past week, the stock declined by 19.92%, while the Sensex remained flat with a 0.02% gain. Over one month, the stock marginally outperformed the Sensex with a 0.87% return versus 2.15%, but this is overshadowed by the longer-term underperformance.
Year-to-date, Bazel International has lost 3.46%, compared to a 2.26% gain in the Sensex. The one-year return of -15.44% starkly contrasts with the Sensex’s 10.6% gain, highlighting the stock’s relative weakness. Over three years, the stock’s 56.76% return is better than the Sensex’s 39.74%, but this is insufficient to offset recent declines and the deteriorating outlook.
Outlook and Investor Considerations
The downgrade to a Strong Sell rating by MarketsMOJO reflects a convergence of negative factors across quality, valuation, financial trend, and technical parameters. While the valuation appears attractive on a Price to Book basis, this is overshadowed by weak profitability, flat financial results, and bearish technical signals. Investors should exercise caution given the stock’s recent sharp declines and underperformance relative to broader market indices.
For those holding Bazel International, it may be prudent to reassess portfolio allocations in light of the company’s challenges and consider alternative NBFC stocks with stronger fundamentals and more favourable technical setups.
Summary of Ratings and Scores
As of 23 Feb 2026, Bazel International’s MarketsMOJO score stands at 26.0, with a Mojo Grade of Strong Sell, downgraded from Sell. The Market Cap Grade is 4, reflecting a mid-tier market capitalisation within the NBFC sector. The technical grade shift from mildly bearish to bearish was the primary catalyst for the rating change, supported by weak financial trends and quality metrics.
In conclusion, the comprehensive analysis indicates that Bazel International Ltd currently faces significant headwinds, making it a high-risk proposition for investors seeking stable returns in the NBFC space.
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