Current Rating and Its Significance
On 08 October 2025, Manomay Tex India Ltd’s rating was revised to 'Hold' from 'Sell', accompanied by a notable increase in its Mojo Score from 42 to 58. This rating indicates a neutral stance, suggesting that investors should neither aggressively buy nor sell the stock at this juncture. Instead, it reflects a balanced view where the stock exhibits certain strengths but also faces challenges that temper enthusiasm.
Here’s How the Stock Looks Today
As of 03 January 2026, Manomay Tex India Ltd operates within the Garments & Apparels sector as a microcap company. The latest data shows a mixed performance across key parameters, which collectively justify the 'Hold' rating. The stock’s recent price movements include a modest 0.49% gain on the day, a 1.81% increase year-to-date, but a negative 8.65% return over the past year, underperforming the broader BSE500 index which has delivered 5.35% returns in the same period.
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- - Fundamental Analysis
- - Technical Signals
- - Peer Comparison
Quality Assessment
The company’s quality grade is assessed as average. This reflects a stable but unremarkable operational profile. One concern is the company’s high Debt to EBITDA ratio of 4.25 times, indicating a relatively low ability to service its debt obligations comfortably. This elevated leverage level poses financial risk, especially in a sector that can be cyclical and sensitive to economic fluctuations. Additionally, the company’s net sales have declined at an annualised rate of -1.58% over the past five years, signalling challenges in sustaining long-term growth.
Valuation Perspective
Despite the quality concerns, Manomay Tex India Ltd’s valuation is considered attractive. The stock trades at an Enterprise Value to Capital Employed ratio of 1.4, which is below the average historical valuations of its peers. This discount suggests that the market currently prices in some of the risks associated with the company’s financial profile. The company’s Return on Capital Employed (ROCE) stands at a reasonable 10.9%, supporting the view that it generates adequate returns on invested capital relative to its valuation.
Financial Trend and Profitability
The financial trend is characterised as flat, reflecting limited momentum in recent quarters. For instance, the company reported net sales of ₹166.15 crores in the quarter ended September 2025, which declined by 5.86% compared to the previous period. However, profitability has shown some resilience, with profits rising by 8.9% over the past year. The PEG ratio of 2.2 indicates that earnings growth is moderate relative to the stock’s price appreciation, which may temper expectations for rapid gains.
Technical Outlook
From a technical standpoint, the stock exhibits mildly bullish signals. Short-term price movements have been mixed, with a 14.92% decline over the past month contrasting with gains of 17.33% over three months and 24.55% over six months. This volatility suggests that while there is some positive momentum, it is not yet strong or consistent enough to warrant a more optimistic rating. The 'Hold' rating thus reflects a cautious approach, recognising potential upside tempered by technical uncertainty.
Market Position and Shareholding
Manomay Tex India Ltd remains a microcap player within the Garments & Apparels sector, with promoters holding the majority stake. The company’s underperformance relative to the broader market over the last year highlights the challenges it faces in gaining investor confidence. Nonetheless, the current valuation and technical signals suggest that the stock is not unattractive for investors seeking exposure to this sector, provided they are mindful of the risks.
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What the Hold Rating Means for Investors
For investors, the 'Hold' rating on Manomay Tex India Ltd suggests a wait-and-watch approach. The stock is neither a compelling buy nor a clear sell at present. Investors should consider the company’s average quality, attractive valuation, flat financial trend, and mildly bullish technicals before making decisions. The rating implies that while the stock may offer some value, it also carries risks related to debt servicing and growth prospects that warrant caution.
Investors looking for exposure to the Garments & Apparels sector may find Manomay Tex India Ltd’s valuation appealing, but should balance this against the company’s operational challenges and market underperformance. Monitoring upcoming quarterly results and any shifts in debt management or sales growth will be crucial to reassessing the stock’s outlook.
Summary
In summary, Manomay Tex India Ltd’s current 'Hold' rating reflects a nuanced view of its business fundamentals and market position as of 03 January 2026. The company’s average quality and flat financial trend are offset by an attractive valuation and some positive technical signals. Investors are advised to maintain a balanced perspective, recognising both the opportunities and risks inherent in the stock’s profile.
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