Current Rating and Its Significance
MarketsMOJO currently assigns Ladderup Finance Ltd a 'Sell' rating, reflecting a cautious stance on the stock. This rating indicates that, based on a comprehensive evaluation of the company's quality, valuation, financial trend, and technical indicators, the stock is expected to underperform relative to the broader market or its sector peers. Investors should consider this recommendation as a signal to reassess their exposure to the stock and weigh potential risks carefully.
Quality Assessment
As of 07 January 2026, Ladderup Finance Ltd exhibits below-average quality metrics. The company’s long-term fundamental strength remains weak, with an average Return on Equity (ROE) of just 1.38%. This low ROE suggests limited efficiency in generating profits from shareholders’ equity. Furthermore, the company has experienced negative growth in key operational areas, with net sales declining at an annualised rate of -7.99% and operating profit shrinking by -9.04%. These figures highlight challenges in sustaining growth and profitability, which weigh heavily on the quality grade.
Valuation Considerations
Despite the weak fundamentals, the stock is currently valued as expensive relative to its financial performance. The Price to Book Value ratio stands at 0.8, which, while indicating a discount compared to some peers’ historical valuations, does not fully compensate for the company’s subdued earnings and growth prospects. The ROE of 1.8% combined with a PEG ratio of 0.3 suggests that although the stock price may appear modest, the underlying earnings growth is insufficient to justify a more favourable valuation. Investors should be cautious, as the expensive valuation relative to quality metrics signals limited upside potential.
Financial Trend Analysis
The financial trend for Ladderup Finance Ltd is currently flat, reflecting stagnation rather than improvement. The latest quarterly results for September 2025 reveal a significant deterioration in profitability, with Profit Before Tax (excluding other income) at a loss of ₹0.23 crore, representing a fall of 116.9% compared to the previous four-quarter average. Similarly, the Profit After Tax (PAT) declined by 128.0% to a loss of ₹0.20 crore. Operating profit margins have also contracted, with the operating profit to net sales ratio dropping to 0.00% in the latest quarter. These figures underscore the company’s struggle to generate consistent earnings and maintain operational efficiency.
Technical Outlook
From a technical perspective, Ladderup Finance Ltd shows a mildly bullish trend. The stock has delivered mixed returns over various time frames as of 07 January 2026: a flat 0.00% change on the day, a 5.19% gain over the past week, and a 28.92% increase over three months. However, the one-year return remains negative at -17.86%, underperforming the broader BSE500 index, which has generated a positive 7.74% return over the same period. This divergence suggests that while short-term price movements have shown some strength, the longer-term trend remains weak, reflecting underlying fundamental challenges.
Market Performance and Investor Implications
Currently, Ladderup Finance Ltd is classified as a microcap within the Non-Banking Financial Company (NBFC) sector. Its market capitalisation and sector positioning imply higher volatility and risk compared to larger, more established peers. The stock’s underperformance relative to the market and peers over the past year, combined with weak fundamentals and an expensive valuation, supports the 'Sell' rating. Investors should consider these factors carefully, particularly those seeking stable returns or exposure to financially robust NBFCs.
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Summary and Outlook
In summary, Ladderup Finance Ltd’s current 'Sell' rating reflects a comprehensive assessment of its financial health and market position as of 07 January 2026. The company faces significant headwinds in quality and financial trends, with weak profitability and declining sales. Its valuation, while showing some discount relative to peers, remains expensive given the lack of robust earnings growth. The mildly bullish technical signals offer limited comfort against the backdrop of fundamental weaknesses.
For investors, this rating suggests prudence. Those holding the stock should evaluate their risk tolerance and consider alternatives with stronger fundamentals and more attractive valuations. Prospective investors may find better opportunities elsewhere in the NBFC sector or broader market, particularly among companies demonstrating consistent growth and profitability.
Key Metrics as of 07 January 2026:
- Mojo Score: 38.0 (Sell Grade)
- Return on Equity (ROE): 1.38%
- Net Sales Growth (Annualised): -7.99%
- Operating Profit Growth (Annualised): -9.04%
- Price to Book Value: 0.8
- PEG Ratio: 0.3
- 1-Year Stock Return: -17.86%
- BSE500 1-Year Return Benchmark: +7.74%
These figures reinforce the rationale behind the current rating and provide a data-driven foundation for investment decisions.
About MarketsMOJO Ratings
MarketsMOJO’s rating system integrates multiple dimensions of stock analysis, including quality, valuation, financial trends, and technical indicators, to provide investors with actionable insights. A 'Sell' rating indicates that the stock is expected to underperform and may carry elevated risks, prompting investors to consider reducing or avoiding exposure.
Investors are encouraged to use these ratings alongside their own research and financial goals to make informed decisions in a dynamic market environment.
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