Understanding the Current Rating
The 'Hold' rating assigned to Mangalore Chem. indicates a neutral stance for investors, suggesting that the stock is expected to perform in line with the broader market or sector averages in the near term. This rating was established on 21 April 2025, following a reassessment of the company’s overall profile. It reflects a balanced view where the stock neither presents a compelling buy opportunity nor signals a need for immediate divestment.
Investors should note that while the rating date is fixed, the financial data and market performance discussed below are current as of 30 December 2025, ensuring that the evaluation is based on the latest available information.
Here’s How Mangalore Chem. Looks Today
As of 30 December 2025, Mangalore Chem. is classified as a smallcap company operating within the Fertilizers sector. The stock’s Mojo Score currently stands at 58.0, which corresponds to the 'Hold' grade. This score reflects a decline from the previous 'Buy' grade, which had a Mojo Score of 71 before the rating adjustment in April.
The stock’s recent price movement shows a modest decline of 0.45% on the day, with a similar percentage drop over the past week and month. Despite this short-term softness, the stock has delivered a remarkable year-to-date return of 99.67% and a one-year return of 99.61%, indicating strong performance over the last twelve months.
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- - Fundamental Analysis
- - Technical Signals
- - Peer Comparison
Quality Assessment
The company’s quality grade is assessed as average. This reflects a mixed operational profile characterised by steady but moderate growth. Over the past five years, Mangalore Chem. has achieved a compound annual growth rate (CAGR) of 6.22% in net sales and 9.16% in operating profit. While these figures indicate consistent expansion, they fall short of the robust growth rates seen in some peers within the fertiliser sector.
Additionally, the company has demonstrated operational resilience by reporting positive results for the last three consecutive quarters. Notably, its operating profit to interest coverage ratio reached a high of 6.57 times, signalling adequate earnings to cover interest expenses. The dividend per share (DPS) has also peaked at Rs 1.50 annually, reflecting a shareholder-friendly approach.
Valuation Considerations
Valuation remains a key factor influencing the 'Hold' rating. Currently, Mangalore Chem. is considered risky from a valuation standpoint. The stock trades at an enterprise value to capital employed (EV/CE) ratio of 2.5, which is relatively expensive compared to its historical averages and some sector peers. Despite this, the stock is trading at a discount relative to the average historical valuations of its competitors, offering some cushion for investors.
The company’s return on capital employed (ROCE) stands at a respectable 14.7%, indicating efficient use of capital to generate profits. However, the price-to-earnings-to-growth (PEG) ratio is 2.8, suggesting that the stock’s price growth may be outpacing its earnings growth, which warrants caution.
Financial Trend and Stability
Financially, Mangalore Chem. shows a positive trend. The company’s debt-equity ratio is relatively low at 0.70 times as of the half-year mark, indicating a conservative capital structure. However, the debt to EBITDA ratio is 2.86 times, signalling a moderate level of leverage that could constrain financial flexibility.
Profit growth has been steady, with an 8% increase over the past year, complementing the strong stock returns. Institutional investors have increased their stake by 2.04% over the previous quarter, now collectively holding 12.5% of the company. This growing institutional interest often reflects confidence in the company’s fundamentals and prospects.
Technical Analysis
The technical grade for Mangalore Chem. is not explicitly rated, but recent price action shows some short-term weakness with a 5.32% decline over the past three months. Despite this, the six-month return of 12.15% and the strong year-to-date performance suggest underlying strength. Investors should monitor technical signals closely to time entries and exits effectively.
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What the Hold Rating Means for Investors
The 'Hold' rating on Mangalore Chem. suggests that investors should maintain their current positions without adding significant new exposure or selling off holdings aggressively. The stock’s fundamentals indicate a stable but not exceptional growth trajectory, with valuation risks balanced by solid financial trends and institutional support.
For long-term investors, this rating implies that while the company is not currently undervalued enough to warrant a strong buy, it remains a viable holding within a diversified portfolio. Investors should watch for improvements in debt servicing capacity and valuation metrics, which could prompt a reassessment of the rating in the future.
In summary, Mangalore Chem. presents a balanced investment case as of 30 December 2025, with steady financial performance, moderate valuation concerns, and a neutral technical outlook. The 'Hold' rating reflects this equilibrium, advising investors to monitor developments closely while maintaining measured exposure.
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