Current Rating Overview
On 02 September 2025, MarketsMOJO revised Honeywell Automation India Ltd’s rating from 'Hold' to 'Sell', reflecting a significant change in the company’s overall assessment. The Mojo Score dropped by 21 points, from 51 to 30, signalling a more cautious stance towards the stock. This rating encapsulates a comprehensive evaluation of the company’s quality, valuation, financial trend, and technical outlook as of today.
Quality Assessment
As of 11 February 2026, Honeywell Automation India Ltd’s quality grade is considered average. The company has demonstrated poor long-term growth, with operating profit declining at an annual rate of -0.51% over the past five years. This sluggish growth trajectory raises concerns about the company’s ability to generate sustainable earnings expansion. Additionally, the return on capital employed (ROCE) for the half-year ended December 2025 stands at a modest 16.42%, which is the lowest in recent periods, indicating limited efficiency in deploying capital to generate profits.
Valuation Perspective
The valuation grade for Honeywell Automation India Ltd is classified as very expensive. Currently, the stock trades at a price-to-book value of 6.8, which is notably high compared to its peers and historical averages. Despite this premium valuation, the company’s return on equity (ROE) is only 12.3%, suggesting that investors are paying a substantial premium for relatively modest profitability. This disparity between valuation and earnings performance warrants caution, as it implies limited margin of safety for investors.
Financial Trend Analysis
The financial trend for the company is flat, reflecting a lack of significant improvement or deterioration in recent results. The latest data as of 11 February 2026 shows that profits have fallen by -3.4% over the past year. Furthermore, the stock has delivered a negative return of -11.77% in the last 12 months, underperforming the broader BSE500 benchmark consistently over the past three years. This persistent underperformance highlights challenges in both operational execution and market sentiment.
Technical Outlook
From a technical standpoint, the stock exhibits a bearish trend. Short-term price movements have been negative, with declines of -0.56% in one day, -3.06% over one week, and -4.58% in one month. The downward momentum extends over longer periods as well, with a 3-month loss of -9.88% and a 6-month decline of -10.88%. These technical signals suggest that market participants remain cautious, and the stock faces resistance in reversing its downward trajectory.
Implications for Investors
The current 'Sell' rating by MarketsMOJO indicates that investors should approach Honeywell Automation India Ltd with caution. The combination of average quality, very expensive valuation, flat financial trends, and bearish technicals suggests limited upside potential and elevated risk. Investors seeking capital preservation or growth may find more attractive opportunities elsewhere, particularly given the stock’s consistent underperformance relative to benchmarks.
Summary of Key Metrics as of 11 February 2026
- Mojo Score: 30.0 (Sell Grade)
- Operating Profit Growth (5 years annualised): -0.51%
- ROCE (Half Year Dec 2025): 16.42%
- ROE: 12.3%
- Price to Book Value: 6.8
- Stock Returns: 1D -0.56%, 1W -3.06%, 1M -4.58%, 3M -9.88%, 6M -10.88%, YTD -2.53%, 1Y -11.77%
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Sector and Market Context
Honeywell Automation India Ltd operates within the industrial manufacturing sector, a space that has faced headwinds amid fluctuating demand and global supply chain challenges. The company’s small-cap status adds an additional layer of volatility and liquidity considerations for investors. Compared to broader market indices such as the BSE500, Honeywell Automation’s stock has consistently lagged, reflecting both sector-specific pressures and company-specific challenges.
Investor Takeaway
For investors, the 'Sell' rating serves as a cautionary signal. It suggests that the stock currently does not offer a compelling risk-reward profile based on its present fundamentals and market behaviour. The very expensive valuation relative to earnings and book value, combined with flat financial trends and bearish technical indicators, implies that the stock may continue to face downward pressure or limited appreciation in the near term.
Investors should consider these factors carefully and may wish to prioritise stocks with stronger growth prospects, more attractive valuations, and positive technical momentum. Monitoring the company’s future earnings reports and sector developments will be crucial to reassessing its investment potential.
Conclusion
In summary, Honeywell Automation India Ltd’s current 'Sell' rating by MarketsMOJO, last updated on 02 September 2025, reflects a comprehensive evaluation of its average quality, very expensive valuation, flat financial trend, and bearish technical outlook as of 11 February 2026. This rating advises investors to exercise caution and consider alternative opportunities with more favourable fundamentals and market dynamics.
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