Dhunseri Tea & Industries Ltd. is Rated Strong Sell

Understanding the Current Rating

The Strong Sell rating assigned to Dhunseri Tea & Industries Ltd. indicates a cautious stance for investors, signalling that the stock currently exhibits significant risks and challenges across multiple dimensions. 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 and helps investors understand the rationale behind the recommendation.

Quality Assessment

As of 05 January 2026, the company’s quality grade is categorised as below average. This reflects weak long-term fundamental strength, particularly evident in the operating profit trajectory. Over the past five years, Dhunseri Tea & Industries Ltd. has experienced a steep decline in operating profits, with a compound annual growth rate (CAGR) of -215.97%. Such a negative trend highlights operational challenges and diminishing profitability.

Further, the company’s ability to service its debt remains poor, with an average EBIT to interest ratio of -2.67, signalling that earnings before interest and tax are insufficient to cover interest expenses. This weak coverage ratio raises concerns about financial stability and credit risk. Additionally, the average return on equity (ROE) stands at a modest 1.19%, indicating low profitability generated per unit of shareholders’ funds. Collectively, these quality metrics suggest that the company is struggling to maintain robust operational and financial health.

Valuation Considerations

The valuation grade for Dhunseri Tea & Industries Ltd. is currently assessed as risky. The stock trades at levels that are unfavourable compared to its historical averages, reflecting heightened uncertainty among investors. Despite the stock’s profits rising by 66.9% over the past year, the share price has declined sharply, delivering a negative return of -40.96% over the same period. This divergence between profit growth and share price performance may indicate market scepticism about the sustainability of earnings or concerns about other underlying risks.

Investors should note that the negative EBITDA position further compounds valuation risks, as it suggests the company is not generating sufficient earnings before interest, taxes, depreciation, and amortisation to cover its operating costs. Such a scenario often leads to increased caution among market participants and can weigh heavily on the stock’s valuation multiples.

Financial Trend Analysis

The financial grade for Dhunseri Tea & Industries Ltd. is described as flat, reflecting stagnation and lack of meaningful improvement in recent quarters. The latest quarterly results ending September 2025 show a decline in profitability metrics. Profit before tax excluding other income (PBT less OI) stood at ₹18.56 crores, down by 47.85% compared to the previous quarter. Similarly, profit after tax (PAT) fell by 26.5% to ₹19.11 crores, while interest expenses increased by 34.72% to ₹5.82 crores.

These figures indicate pressure on the company’s earnings and rising financing costs, which can constrain cash flow and limit reinvestment capacity. The flat financial trend suggests that the company has yet to demonstrate a clear turnaround or growth trajectory, which is a critical consideration for investors evaluating future prospects.

Technical Outlook

The technical grade assigned to the stock is bearish, signalling negative momentum in the share price. As of 05 January 2026, the stock’s recent price movements reinforce this outlook, with a one-day decline of -0.47%, a one-month drop of -3.22%, and a six-month fall of -20.51%. Over the past year, the stock has lost nearly 41% of its value, reflecting sustained selling pressure and weak investor sentiment.

Short-term technical indicators suggest limited support levels, and the stock’s inability to sustain upward momentum may deter new buyers. For investors, this bearish technical stance implies a higher risk of further downside in the near term, reinforcing the caution advised by the current rating.

What the Strong Sell Rating Means for Investors

For investors, the Strong Sell rating on Dhunseri Tea & Industries Ltd. serves as a clear signal to exercise caution. It suggests that the stock currently carries elevated risks due to weak fundamentals, unfavourable valuation, stagnant financial performance, and negative technical indicators. Investors holding the stock may consider reassessing their positions in light of these factors, while prospective buyers should carefully weigh the risks before committing capital.

It is important to note that this rating does not imply an immediate exit for all investors but rather highlights the need for thorough due diligence and risk management. The company’s microcap status and sector affiliation with FMCG add further context, as smaller companies often face greater volatility and liquidity challenges.

Ultimately, the rating reflects a comprehensive analysis by MarketsMOJO, integrating quantitative data and market signals to provide a balanced view of the stock’s current standing as of 05 January 2026.

Summary of Key Metrics as of 05 January 2026

• Mojo Score: 12.0 (Strong Sell)


• Market Capitalisation: Microcap


• Quality Grade: Below Average


• Valuation Grade: Risky


• Financial Grade: Flat


• Technical Grade: Bearish


• Stock Returns: 1 Day -0.47%, 1 Week +0.47%, 1 Month -3.22%, 3 Months -14.69%, 6 Months -20.51%, Year-to-Date -1.03%, 1 Year -40.96%


• Operating Profit CAGR (5 years): -215.97%


• EBIT to Interest Ratio (avg): -2.67


• Return on Equity (avg): 1.19%


• Latest Quarterly PBT less OI: ₹18.56 crores (-47.85%)


• Latest Quarterly PAT: ₹19.11 crores (-26.5%)


• Latest Quarterly Interest Expense: ₹5.82 crores (+34.72%)

Investors should continue to monitor the company’s quarterly updates and market developments to reassess the outlook as new information becomes available.

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