Current Rating and Its Significance
The current Buy rating indicates that MarketsMOJO sees Mangalore Refinery & Petrochemicals Ltd. as a favourable investment opportunity based on a comprehensive evaluation of its quality, valuation, financial trend, and technical outlook. This rating suggests that the stock is expected to deliver returns above the market average, making it attractive for investors seeking growth in the oil sector.
Quality Assessment
As of 19 February 2026, the company holds an average quality grade. This reflects a stable operational foundation with consistent growth in key financial parameters. Notably, the company has demonstrated healthy long-term growth, with net sales increasing at an annual rate of 22.62% and operating profit growing at 25.12%. These figures underscore the company’s ability to expand its core business efficiently over time.
Valuation Perspective
The valuation grade is currently assessed as fair. The stock trades at an enterprise value to capital employed ratio of 1.9, which is below the average historical valuations of its peers, indicating a relative discount. Additionally, the company’s return on capital employed (ROCE) stands at 10.4%, supporting the notion that the stock is reasonably priced given its earnings potential. The price-to-earnings-to-growth (PEG) ratio is notably low at 0.1, suggesting that the stock’s price growth is not fully reflecting its profit growth trajectory, which is a positive sign for value-conscious investors.
Financial Trend and Performance
The financial grade is rated as very positive, reflecting strong recent performance and robust financial health. As of 19 February 2026, the company has reported a remarkable 131.72% growth in net profit, supported by two consecutive quarters of positive results. Operating profit to interest coverage ratio is at a high of 12.72 times, indicating strong earnings relative to debt servicing costs. Cash and cash equivalents have reached ₹874.25 crores, the highest recorded, while the debt-to-equity ratio remains low at 0.81 times, signalling prudent financial management and a solid balance sheet.
Technical Outlook
The technical grade is bullish, reflecting positive momentum in the stock price and favourable market sentiment. The stock has delivered impressive returns recently, with a 1-day gain of 3.26%, a 1-month increase of 36.83%, and a 6-month rise of 56.77%. Over the past year, the stock has surged by 72.09%, significantly outperforming the BSE500 index and demonstrating strong investor confidence. Year-to-date returns stand at 29.01%, reinforcing the stock’s upward trajectory in the current market environment.
Market Position and Shareholding
Mangalore Refinery & Petrochemicals Ltd. is classified as a small-cap stock within the oil sector. The majority shareholding is held by promoters, which often suggests stable management control and alignment with shareholder interests. The company’s market-beating performance over multiple time frames, including 3 months, 1 year, and 3 years, highlights its resilience and growth potential in a competitive industry.
Summary of Key Financial Metrics as of 19 February 2026
- Net Sales growth rate: 22.62% annually
- Operating Profit growth rate: 25.12% annually
- Net Profit growth: 131.72%
- Operating Profit to Interest Coverage: 12.72 times
- Cash and Cash Equivalents: ₹874.25 crores
- Debt-Equity Ratio: 0.81 times
- Return on Capital Employed (ROCE): 10.4%
- Enterprise Value to Capital Employed: 1.9
- PEG Ratio: 0.1
- 1-Year Stock Return: 72.09%
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What This Rating Means for Investors
For investors, the Buy rating on Mangalore Refinery & Petrochemicals Ltd. signals a stock with solid fundamentals, attractive valuation, and strong financial momentum. The company’s ability to generate significant profit growth while maintaining a healthy balance sheet and low debt levels reduces investment risk. Furthermore, the bullish technical indicators suggest that the stock price is likely to continue its upward trend in the near term.
Investors should consider this rating as an endorsement of the company’s current operational and financial strength, as well as its potential to outperform the broader market. However, as with all investments, it is prudent to monitor sector dynamics and company-specific developments that could impact future performance.
Sector and Market Context
Operating within the oil sector, Mangalore Refinery & Petrochemicals Ltd. benefits from favourable industry tailwinds, including rising energy demand and improving refining margins. The company’s consistent growth in net sales and operating profit reflects its ability to capitalise on these trends. Compared to its peers, the stock’s valuation remains reasonable, offering a compelling entry point for investors seeking exposure to the energy sector with a growth orientation.
Long-Term Outlook
Over the long term, the company’s demonstrated ability to grow sales and profits at double-digit rates, combined with prudent financial management, positions it well for sustained value creation. The strong cash position and manageable debt levels provide flexibility to invest in capacity expansion or other strategic initiatives, which could further enhance shareholder returns.
In summary, the MarketsMOJO Buy rating on Mangalore Refinery & Petrochemicals Ltd. reflects a well-rounded assessment of quality, valuation, financial health, and technical strength, making it a stock worthy of consideration for investors aiming to capitalise on growth opportunities in the oil sector.
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