Understanding the Current Rating
The Strong Sell rating assigned to Jay Shree Tea & Industries Ltd indicates a cautious stance for investors, suggesting that the stock is expected to underperform relative to the broader market. This rating is based on a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. Each of these factors contributes to the overall assessment of the company’s investment appeal.
Quality Assessment
As of 28 February 2026, Jay Shree Tea’s quality grade remains below average. The company exhibits weak long-term fundamental strength, reflected in an average Return on Capital Employed (ROCE) of 0%. This indicates that the firm is currently not generating adequate returns on the capital invested, which is a critical measure of operational efficiency and profitability. Furthermore, operating profit has declined sharply, with a negative annual growth rate of -148.56% over the past five years. Such a steep contraction in operating profit signals significant challenges in sustaining business growth and profitability.
Valuation Considerations
The valuation grade for Jay Shree Tea is classified as risky. The stock is trading at valuations that are unfavourable compared to its historical averages, which raises concerns about its price relative to earnings and growth prospects. Over the past year, the stock has delivered a return of -11.90%, while profits have fallen by -85.4%. This divergence between price performance and deteriorating profitability suggests that the market is pricing in considerable risk, and investors should be wary of potential downside.
Financial Trend Analysis
Financially, the company is facing a negative trend. The latest quarterly results for December 2025 reveal a net loss (PAT) of ₹-1.50 crore, representing a decline of -108.3%. Additionally, cash and cash equivalents have dwindled to ₹4.23 crore as of the half-year mark, indicating constrained liquidity. The company’s debt servicing capacity is also under pressure, with a high Debt to EBITDA ratio of -1.00 times, which is indicative of financial stress. These factors collectively point to a deteriorating financial health that investors must consider carefully.
Technical Outlook
From a technical perspective, Jay Shree Tea’s stock exhibits a bearish trend. The technical grade assigned is bearish, reflecting negative momentum in the stock price. Recent price movements show a 1-day decline of -1.34%, a 3-month drop of -11.17%, and a 6-month fall of -17.65%. Year-to-date, the stock has declined by -5.76%. This persistent downward trend suggests weak investor sentiment and limited short-term recovery prospects.
Stock Returns and Market Comparison
As of 28 February 2026, Jay Shree Tea has underperformed key market benchmarks such as the BSE500 index over multiple time frames including the last three years, one year, and three months. The stock’s negative returns and below-par performance relative to the broader market reinforce the rationale behind the Strong Sell rating. Investors seeking capital preservation or growth may find more attractive opportunities elsewhere in the FMCG sector or broader market.
Summary for Investors
In summary, the Strong Sell rating for Jay Shree Tea & Industries Ltd reflects a combination of weak fundamental quality, risky valuation, negative financial trends, and bearish technical signals. For investors, this rating serves as a cautionary indicator that the stock currently carries significant downside risk and may not be suitable for those seeking stable or appreciating investments. It is essential to monitor the company’s financial health and market conditions closely before considering any exposure.
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Company Profile and Market Capitalisation
Jay Shree Tea & Industries Ltd operates within the FMCG sector and is classified as a microcap company. This classification often implies higher volatility and risk due to lower liquidity and market depth. Investors should be mindful of these factors when evaluating the stock’s potential within their portfolios.
Mojo Score and Grade Details
The company’s Mojo Score currently stands at 3.0, a significant decline from its previous score of 31. This drop corresponds with the change in rating from Sell to Strong Sell on 03 Nov 2025. The Mojo Grade reflects a comprehensive assessment of the company’s financial health, market performance, and technical outlook, consolidating these into a single actionable rating for investors.
Long-Term Outlook and Risks
Given the persistent negative trends in profitability, liquidity constraints, and bearish price action, the long-term outlook for Jay Shree Tea remains challenging. The company’s inability to generate positive operating profits and its high debt burden increase the risk profile substantially. Investors should consider these risks carefully, especially in the context of portfolio diversification and risk tolerance.
Conclusion
Jay Shree Tea & Industries Ltd’s Strong Sell rating by MarketsMOJO, last updated on 03 Nov 2025, is supported by current data as of 28 February 2026 that highlights weak fundamentals, risky valuation, negative financial trends, and bearish technical indicators. This comprehensive evaluation suggests that the stock is likely to underperform and carries elevated risk, advising investors to approach with caution or consider alternative investment opportunities.
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