Exide Industries Ltd is Rated Sell

Current Rating and Its Significance

MarketsMOJO currently assigns Exide Industries Ltd a 'Sell' rating, indicating a cautious stance towards the stock. This rating suggests that investors should consider reducing exposure or avoiding new purchases at this time, given the company's present fundamentals and market conditions. The rating was revised on 22 December 2025, moving from a 'Strong Sell' to a 'Sell', reflecting a slight improvement in the company's outlook, but still signalling concerns that warrant prudence.

How the Stock Looks Today: Quality Assessment

As of 25 January 2026, Exide Industries Ltd maintains a good quality grade. This reflects the company’s stable operational framework and consistent business model within the Auto Components & Equipments sector. Despite challenges, the firm has demonstrated resilience in its core operations. However, the quality grade alone does not offset other areas of concern, particularly in financial trends and valuation.

Valuation Perspective

The stock is currently considered expensive, with a Price to Book Value of 1.9 and a Return on Equity (ROE) of 5.4%. This valuation premium places Exide Industries above its peer group average historical valuations, suggesting that the market price may not fully reflect the underlying risks. Investors should note that the stock’s elevated valuation, combined with subdued profitability metrics, raises questions about the potential for near-term price appreciation.

Financial Trend Analysis

The financial trend for Exide Industries Ltd is negative as of today. The latest quarterly results for September 2025 reveal a decline in key profitability indicators. Profit Before Tax excluding other income (PBT LESS OI) stood at ₹199.67 crores, down 28.7% compared to the previous four-quarter average. Similarly, Profit After Tax (PAT) declined by 18.9% to ₹171.94 crores. The company’s Return on Capital Employed (ROCE) for the half-year is at a low 8.11%, signalling diminished efficiency in capital utilisation. Over the past five years, net sales have grown at a modest annual rate of 5.12%, while operating profit has increased by 7.92%, indicating slow growth momentum.

Technical Outlook

From a technical standpoint, the stock is currently bearish. Price performance over recent periods has been weak, with the stock declining 2.75% in the last day and 5.56% over the past week. Longer-term returns also reflect this downtrend, with losses of 12.17% over one month, 17.08% over three months, and 15.19% over the past year. This underperformance contrasts sharply with the broader market, where the BSE500 index has delivered a positive 5.14% return over the same one-year period. The technical grade underscores the prevailing negative market sentiment and the stock’s inability to sustain upward momentum.

Returns and Market Comparison

Currently, Exide Industries Ltd has delivered a negative return of 15.19% over the last year, significantly underperforming the broader market benchmark. The stock’s year-to-date return is also negative at 10.24%, reflecting ongoing investor caution. This performance gap highlights the challenges faced by the company in regaining investor confidence amid a difficult operating environment and valuation concerns.

Summary for Investors

For investors, the 'Sell' rating on Exide Industries Ltd signals a need for caution. While the company exhibits good quality fundamentals, the expensive valuation, negative financial trends, and bearish technical outlook collectively suggest limited upside potential in the near term. Investors should carefully weigh these factors against their portfolio objectives and risk tolerance before considering exposure to this stock.

Company Profile and Market Position

Exide Industries Ltd is a midcap company operating in the Auto Components & Equipments sector. Despite its established presence, the company has struggled to generate robust growth in recent years. The slow pace of sales and operating profit growth over the last five years reflects structural challenges within the sector and competitive pressures. Investors should consider these sector dynamics when evaluating the stock’s prospects.

Outlook and Considerations

Given the current financial and technical indicators, the outlook for Exide Industries Ltd remains cautious. The company’s negative financial trend and expensive valuation suggest that it may face headwinds in delivering shareholder returns in the near term. However, the good quality grade indicates that the company’s core business remains sound, which could provide a foundation for recovery if market conditions improve.

Investor Takeaway

In summary, the 'Sell' rating reflects a balanced assessment of Exide Industries Ltd’s current situation. Investors should be mindful of the stock’s recent underperformance, valuation concerns, and negative financial trends. Those holding the stock may consider reviewing their positions, while prospective investors might await clearer signs of financial improvement and technical strength before committing capital.

Key Metrics at a Glance (As of 25 January 2026)

• Mojo Score: 30.0 (Sell Grade)


• Price to Book Value: 1.9 (Expensive)


• Return on Equity (ROE): 5.4%


• Return on Capital Employed (ROCE): 8.11% (Half Year)


• 1-Year Stock Return: -15.19%


• BSE500 1-Year Return: +5.14%


• Net Sales Growth (5 years CAGR): 5.12%


• Operating Profit Growth (5 years CAGR): 7.92%

Conclusion

Exide Industries Ltd’s current 'Sell' rating by MarketsMOJO is grounded in a comprehensive evaluation of quality, valuation, financial trends, and technical factors. While the company maintains operational quality, the expensive valuation and negative financial and technical outlooks suggest limited near-term upside. Investors should approach the stock with caution and monitor developments closely for any signs of improvement.

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