Clean Science & Technology Ltd is Rated Strong Sell

Current Rating and Its Significance

MarketsMOJO’s Strong Sell rating on Clean Science & Technology Ltd indicates a cautious stance for investors, suggesting that the stock is expected to underperform relative to the broader market and its peers. This rating 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, helping investors understand the risks and challenges facing the company today.

Quality Assessment

As of 20 January 2026, Clean Science & Technology Ltd holds a good quality grade. This reflects the company’s operational strengths and business fundamentals, including its product offerings and market position within the specialty chemicals sector. Despite this, the company’s long-term growth has been modest, with operating profit growing at an annual rate of just 5.93% over the past five years. This slow growth rate signals limited expansion potential, which weighs on the overall quality score.

Valuation Considerations

The valuation grade for Clean Science & Technology Ltd is currently very expensive. The stock trades at a price-to-book ratio of 6, which is significantly higher than typical benchmarks and indicates that investors are paying a premium for the company’s equity. This elevated valuation is not fully supported by the company’s financial performance, as evidenced by a price-to-earnings-to-growth (PEG) ratio of 11.6. Such a high PEG ratio suggests that the stock’s price growth expectations are disproportionate to its earnings growth, which has been modest at 3% over the past year.

Financial Trend Analysis

The financial trend for Clean Science & Technology Ltd is negative as of 20 January 2026. The latest quarterly results for September 2025 reveal a decline in key profitability metrics. Profit before tax (excluding other income) fell by 14.9% to ₹68.19 crores compared to the previous four-quarter average, while profit after tax dropped by 17.4% to ₹55.43 crores. Additionally, the company reported its lowest quarterly earnings before depreciation, interest, and taxes (PBDIT) at ₹87.09 crores. These figures highlight a weakening financial position, which is a critical factor behind the Strong Sell rating.

Technical Outlook

The technical grade for the stock is bearish, reflecting negative momentum in the share price. Over the past year, Clean Science & Technology Ltd has delivered a return of -40.07%, significantly underperforming the BSE500 benchmark and its sector peers. The stock’s recent price movements show a downward trend, with a 6-month decline of 35.14% and a 3-month drop of 17.26%. This persistent underperformance signals weak investor sentiment and technical pressure, reinforcing the cautious stance advised by the Strong Sell rating.

Stock Performance and Market Context

As of 20 January 2026, the stock’s short-term price changes have been marginally positive, with a 1-day gain of 0.12% and a 1-week increase of 0.14%. However, these small upticks do little to offset the broader negative trend observed over longer periods. The year-to-date return stands at -2.43%, while the 1-month return is down 4.80%. This performance is consistent with the company’s deteriorating fundamentals and bearish technical indicators.

Return on Equity and Market Capitalisation

Clean Science & Technology Ltd maintains a return on equity (ROE) of 17.7%, which is respectable but insufficient to justify its current high valuation. The company is classified as a small-cap stock within the specialty chemicals sector, which often entails higher volatility and risk compared to larger, more established companies. Investors should weigh these factors carefully when considering exposure to this stock.

Summary for Investors

The Strong Sell rating from MarketsMOJO reflects a comprehensive view of Clean Science & Technology Ltd’s current challenges. While the company demonstrates good quality in its operations, its very expensive valuation, negative financial trends, and bearish technical outlook collectively suggest that the stock is likely to face continued headwinds. Investors are advised to approach this stock with caution, considering the risks of further price declines and underperformance relative to the broader market.

Long-Term Growth and Profitability Challenges

Despite a good quality grade, Clean Science & Technology Ltd’s long-term growth remains subdued. The company’s operating profit growth rate of 5.93% annually over five years is modest for a specialty chemicals firm, which typically benefits from innovation and expanding industrial demand. The negative quarterly results in September 2025 further underscore the challenges in sustaining profitability, with declines in PBT and PAT signalling operational pressures.

Valuation Risks Amidst Weak Financials

The stock’s very expensive valuation, with a price-to-book ratio of 6, raises concerns about the sustainability of its current market price. While the company’s ROE of 17.7% is solid, it does not sufficiently justify the premium valuation, especially given the negative financial trend and earnings volatility. The PEG ratio of 11.6 indicates that investors are pricing in growth expectations that the company has yet to demonstrate, increasing the risk of valuation correction.

Consistent Underperformance Against Benchmarks

Clean Science & Technology Ltd has consistently underperformed the BSE500 benchmark over the last three years. The stock’s 40.21% negative return over the past year contrasts sharply with the broader market’s performance, highlighting the stock’s relative weakness. This persistent underperformance is a key factor in the bearish technical grade and the Strong Sell recommendation.

Investor Takeaway

For investors, the Strong Sell rating serves as a warning to reconsider exposure to Clean Science & Technology Ltd at this time. The combination of expensive valuation, deteriorating financial results, and negative price momentum suggests limited upside potential and elevated downside risk. Those holding the stock may want to evaluate their positions carefully, while prospective investors should seek more favourable entry points or alternative opportunities within the specialty chemicals sector.

Conclusion

In summary, Clean Science & Technology Ltd’s current Strong Sell rating by MarketsMOJO, updated on 06 Nov 2025, reflects a thorough analysis of the company’s present-day fundamentals as of 20 January 2026. The stock’s good quality is overshadowed by very expensive valuation, negative financial trends, and bearish technical signals. Investors are advised to approach this stock with caution, recognising the risks inherent in its current profile.

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