Bazel International Ltd Upgraded to Sell on Technical Improvements and Valuation Appeal

Quality Assessment: Weak Fundamentals Persist

Bazel International’s fundamental quality remains under pressure. The company reported flat financial results for the quarter ending December 2025, with Profit Before Depreciation, Interest and Taxes (PBDIT) at a low ₹0.31 crore and Earnings Per Share (EPS) at ₹0.55, marking the lowest quarterly figures in recent periods. The average Return on Equity (ROE) stands at a modest 2.04%, signalling weak profitability relative to equity capital employed. This underperformance is further underscored by a 27.1% decline in profits over the past year, highlighting ongoing operational challenges.

Despite these concerns, Bazel International’s valuation metrics present a contrasting picture. The stock trades at a Price to Book Value (P/BV) of 0.5, indicating a significant discount compared to its peers and historical averages. This valuation attractiveness is a key factor for investors seeking value opportunities in the NBFC sector, although it must be weighed against the company’s subdued earnings trajectory.

Valuation: Attractive but Reflective of Risks

The company’s market capitalisation grade remains at 4, reflecting its micro-cap status and relatively modest market presence. Bazel International’s current share price of ₹74.34 is well below its 52-week high of ₹91.00 but comfortably above the 52-week low of ₹50.05, suggesting some price resilience. Over the past month, the stock has delivered a robust 22.75% return, significantly outperforming the Sensex’s marginal decline of 0.14% during the same period. Year-to-date returns stand at 23.74%, again surpassing the Sensex’s negative 2.08% return, indicating short-term investor interest despite longer-term concerns.

However, over the last one year, Bazel International has underperformed the broader market, generating a negative return of -3.73% compared to the BSE500’s positive 13.53%. This divergence highlights the stock’s volatility and the market’s cautious stance on its recovery prospects.

Financial Trend: Flat Performance Amidst Market Volatility

The company’s recent quarterly results reflect a stagnant financial trend, with no significant improvement in earnings or operational metrics. The PBDIT and EPS figures for Q3 FY25-26 are at their lowest, signalling a lack of momentum in core business activities. This flat performance contrasts with the broader NBFC sector, which has seen pockets of recovery and growth in recent quarters.

Longer-term returns tell a mixed story. While Bazel International has delivered a strong 96.41% return over three years, comfortably outperforming the Sensex’s 36.80% gain, the one-year underperformance and flat recent quarters raise questions about sustainability. The company’s shareholder base remains predominantly non-institutional, which may limit access to strategic capital and influence market perception.

Technical Analysis: Key Driver of Upgrade

The primary catalyst for the upgrade from Strong Sell to Sell is the improvement in Bazel International’s technical indicators. The technical grade has shifted from bearish to mildly bearish, reflecting a more constructive price action outlook. Key technical signals include:

• MACD: Weekly readings remain bearish, but monthly MACD has improved to mildly bearish, indicating a potential easing of downward momentum.
• RSI: Both weekly and monthly Relative Strength Index (RSI) show no clear signal, suggesting the stock is neither overbought nor oversold.
• Bollinger Bands: Weekly and monthly Bollinger Bands are bullish, signalling increased price volatility with upward bias.
• Moving Averages: Daily moving averages remain mildly bearish, but the trend is less negative than before.
• KST (Know Sure Thing): Weekly KST is bearish, but monthly KST has improved to mildly bearish.
• Dow Theory: Weekly trend is mildly bullish, while monthly remains mildly bearish, indicating mixed but improving momentum.

These technical improvements have supported a positive shift in investor sentiment, reflected in the stock’s 2.64% gain on the day of the rating change and a recent trading range between ₹69.00 and ₹75.90. The stock’s ability to hold above its previous close of ₹72.43 and approach the upper Bollinger Band suggests a potential for further short-term gains.

Market Context and Outlook

Bazel International’s recent upgrade to Sell from Strong Sell by MarketsMOJO reflects a nuanced view balancing technical recovery against fundamental weaknesses. The company’s Mojo Grade of Sell, up from Strong Sell, signals cautious optimism but stops short of recommending a buy. Investors should note the company’s underperformance relative to the broader market over the past year, despite strong multi-year returns.

The NBFC sector remains competitive and sensitive to macroeconomic factors such as interest rate changes and credit demand. Bazel International’s valuation discount may attract value investors, but the flat financial trend and low ROE suggest that operational improvements are needed to justify a more bullish stance.

Technical indicators suggest the stock may be stabilising, with bullish signals from Bollinger Bands and a mildly bullish weekly Dow Theory trend. However, mixed signals from MACD and KST imply that momentum remains fragile. Traders may find short-term opportunities, but long-term investors should remain cautious until fundamental performance improves.

Overall, the upgrade reflects a technical rebound rather than a fundamental turnaround, and investors should weigh the risks of flat earnings and weak profitability against the stock’s attractive valuation and improving price action.

Summary of Bazel International Ltd Ratings and Scores

• Mojo Score: 31.0 (Upgraded from previous lower score)
• Mojo Grade: Sell (Upgraded from Strong Sell on 17 Feb 2026)
• Market Cap Grade: 4 (Micro-cap category)
• Technical Grade: Improved from Bearish to Mildly Bearish
• Return on Equity (ROE): 2.04% (Weak)
• Price to Book Value: 0.5 (Attractive valuation)
• Recent Price Performance: +22.75% (1 month), -3.73% (1 year)

Investors should monitor upcoming quarterly results and sector developments closely to reassess Bazel International’s prospects. The current rating upgrade offers a cautiously improved outlook but does not yet signal a definitive recovery.

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