Inventure Growth & Securities Ltd Downgraded to Strong Sell Amid Mixed Financial and Technical Signals

Financial Performance: A Mixed but Improving Picture

Inventure Growth & Securities Ltd reported a notable improvement in its financial trend for the quarter ended December 2025, which was a key factor in the recent rating adjustment. The company’s Profit Before Tax excluding Other Income (PBT LESS OI) surged to ₹3.96 crores, marking a robust growth of 143.3% compared to the average of the previous four quarters. Even more striking was the Profit After Tax (PAT) for the quarter, which climbed to ₹3.07 crores, representing an impressive 213.1% increase over the same comparative period.

Additionally, the company’s debt-equity ratio improved to a low 0.10 times at the half-year mark, signalling a conservative capital structure and reduced financial risk. However, cash and cash equivalents declined to ₹116.45 crores, the lowest level recorded in recent periods, which may raise concerns about liquidity management.

Despite these positive quarterly results, the company’s longer-term financial health remains under pressure. The average Return on Equity (ROE) stands at a modest 4.98%, reflecting weak profitability relative to shareholder equity. Furthermore, operating profit has exhibited a negative compound annual growth rate of -0.07%, indicating stagnation or decline in core earnings over time.

Valuation: From Attractive to Fair but Still Premium

The valuation grade for Inventure Growth & Securities Ltd has shifted from attractive to fair, reflecting a recalibration of market expectations. The company’s Price-to-Earnings (PE) ratio currently stands at 17.28, which is moderate but higher than some peers in the capital markets sector. The Price-to-Book (P/B) value is 0.43, suggesting the stock is trading below its book value but not at a deeply discounted level.

Enterprise Value to EBITDA (EV/EBITDA) is at 2.26, indicating a relatively low valuation on an earnings basis, yet this is juxtaposed with the company’s subdued Return on Capital Employed (ROCE) of 5.30% and a low ROE of 1.41% for the latest period. These metrics suggest that while the stock is not expensive in absolute terms, its valuation premium relative to its weak profitability metrics may be a cause for caution among investors.

Comparatively, peers such as Mufin Green and Arman Financial are classified as very expensive, while others like SMC Global Securities and Satin Creditcare maintain attractive valuations. This places Inventure Growth & Securities Ltd in a middle ground, but with limited upside potential given its financial constraints.

Technical Analysis: Predominantly Bearish Signals

Technical indicators for Inventure Growth & Securities Ltd have deteriorated, contributing to the downgrade in its overall rating. The technical trend has shifted from mildly bearish to outright bearish, reflecting weakening momentum in the stock price.

On a weekly basis, the Moving Average Convergence Divergence (MACD) remains mildly bullish, but the monthly MACD is bearish, indicating longer-term downward pressure. The Relative Strength Index (RSI) shows no clear signal on both weekly and monthly charts, suggesting a lack of strong directional momentum.

Bollinger Bands analysis reveals bearish tendencies on the weekly chart and mildly bearish on the monthly chart, signalling increased volatility with a downward bias. Daily moving averages are firmly bearish, reinforcing the negative short-term trend.

Other momentum indicators such as the Know Sure Thing (KST) oscillator are bearish on both weekly and monthly timeframes, while Dow Theory analysis shows no clear trend weekly and mildly bearish monthly. On-Balance Volume (OBV) indicators do not show any significant trend, indicating a lack of strong buying interest.

Overall, the technical picture suggests that despite some short-term positive financial results, the stock faces downward pressure from market sentiment and momentum factors.

Quality Assessment: Weak Long-Term Fundamentals

Inventure Growth & Securities Ltd’s quality rating remains poor, with a Mojo Score of 26.0 and a Mojo Grade of Strong Sell, downgraded from Sell as of 17 February 2026. This reflects the company’s weak long-term fundamental strength despite recent quarterly improvements.

The company’s long-term returns have been disappointing, with a one-year stock return of -30.30% compared to a 9.81% gain in the Sensex. Over three and five years, the stock has underperformed significantly, delivering -43.32% and -40.94% returns respectively, while the Sensex gained 36.80% and 61.40% over the same periods.

These figures highlight the company’s inability to generate sustainable shareholder value over time. The majority of shares are held by non-institutional investors, which may limit the stock’s liquidity and institutional support.

Market Performance and Price Movements

The stock price of Inventure Growth & Securities Ltd closed steady at ₹1.15 on 18 February 2026, unchanged from the previous close. The 52-week high stands at ₹1.83, while the 52-week low is ₹0.95, indicating a relatively narrow trading range with limited upside momentum.

Short-term price movements have been mixed, with a one-week return of -0.86% slightly outperforming the Sensex’s -0.98% over the same period. The one-month return is positive at 1.77%, outperforming the Sensex’s -0.14%. Year-to-date, the stock has gained 0.88%, while the Sensex declined by 2.08%. However, these short-term gains are overshadowed by the significant underperformance over longer horizons.

The stock’s technical and fundamental challenges suggest that investors should remain cautious despite recent positive quarterly results.

Conclusion: A Cautious Outlook Despite Recent Financial Gains

Inventure Growth & Securities Ltd’s downgrade to a Strong Sell rating reflects a nuanced assessment of its current position. While the company has demonstrated encouraging financial improvements in the latest quarter, including strong profit growth and a conservative debt profile, these gains are insufficient to offset the weak long-term fundamentals, subdued profitability, and bearish technical indicators.

The fair valuation rating, combined with the company’s underwhelming returns relative to the broader market and peers, suggests limited upside potential. Investors should weigh these factors carefully and consider alternative opportunities within the capital markets sector that may offer stronger growth prospects and more favourable technical setups.

Unlock special upgrade rates for a limited period. Start Saving Now →