Nuvama Wealth Management Ltd Upgraded to Hold by MarketsMOJO on Technical Improvements

Technical Trend Shift Spurs Upgrade

The primary catalyst for the upgrade was a change in the technical grade, which moved from a sideways pattern to a mildly bullish trend. This shift is supported by daily moving averages that have turned mildly bullish, indicating a potential upward momentum in the near term. While weekly and monthly MACD readings remain mildly bearish or neutral, the overall technical summary suggests a cautious but positive outlook.

Other technical indicators present a mixed picture: the weekly Bollinger Bands remain bearish, but monthly bands are sideways, suggesting limited volatility. The Dow Theory readings are mildly bearish on a weekly basis but mildly bullish monthly, while the On-Balance Volume (OBV) indicator shows mild bearishness weekly and mild bullishness monthly. This blend of signals points to a market in transition, with technicals improving enough to warrant a rating upgrade but not yet fully bullish.

On 29 Jan 2026, Nuvama Wealth’s stock price closed at ₹1,317.30, up 4.13% from the previous close of ₹1,265.00, with intraday highs touching ₹1,333.90. The 52-week range remains wide, from ₹913.56 to ₹1,702.00, reflecting significant volatility over the past year.

Valuation Remains Expensive but Justified by Growth

Despite the upgrade, valuation metrics remain a concern. Nuvama Wealth trades at a high Price to Book (P/B) ratio of 6.3, reflecting a very expensive valuation relative to its book value. The Price/Earnings to Growth (PEG) ratio stands at 2.1, indicating that the stock’s price growth is outpacing earnings growth, which may temper enthusiasm among value-focused investors.

However, these elevated valuations are somewhat justified by the company’s strong long-term growth prospects. Operating profit has grown at an annualised rate of 37.08%, and the average Return on Equity (ROE) remains robust at 26.77%. These figures underscore the company’s ability to generate healthy returns on capital, supporting a premium valuation in the capital markets sector.

Financial Trend: Flat Quarterly Performance but Strong Long-Term Growth

The recent quarterly results for Q3 FY25-26 were largely flat, with earnings per share (EPS) at a low of ₹14.08. This stagnation contributed to the previous Sell rating, but the company’s long-term financial trajectory remains positive. Over the past year, profits have increased by 12.7%, while the stock has delivered a market-beating return of 26.34%, significantly outperforming the BSE500 index’s 9.89% return.

Comparing returns over different periods, Nuvama Wealth underperformed the Sensex in the short term, with a 1-month return of -11.83% versus Sensex’s -3.17%, and a year-to-date return of -10.96% against Sensex’s -3.37%. However, over the last one year, the stock’s 26.34% return far exceeds the Sensex’s 8.49%, highlighting a strong recovery and resilience in the medium term.

Longer-term data is not available for the stock, but the Sensex’s 3-year and 5-year returns of 38.79% and 75.67%, respectively, provide a benchmark for assessing future expectations.

Quality Assessment: Strong Fundamentals Offset Risks

Nuvama Wealth’s quality grade remains solid, supported by its consistent ROE of 27.1% and healthy operating profit growth. However, the company faces risks from promoter share pledging, with 62.8% of promoter shares pledged. This high level of pledged shares can exert downward pressure on the stock price during market downturns, adding a layer of risk for investors.

Despite this, the company’s strong fundamentals and market-beating performance over the past year have contributed to the upgrade to a Hold rating. The Mojo Score of 58.0 and a Market Cap Grade of 3 reflect a moderate risk-reward profile, suitable for investors seeking exposure to capital markets with a balanced approach.

Market Context and Outlook

Within the capital markets sector, Nuvama Wealth’s upgrade to Hold reflects a cautious but positive stance amid a volatile environment. The stock’s recent price appreciation of 4.13% on 29 Jan 2026 and its recovery from lows near ₹913.56 in the past year demonstrate resilience. However, the wide 52-week range and mixed technical signals suggest that investors should remain vigilant.

Given the flat quarterly earnings and expensive valuation, the upgrade does not signal a strong buy but rather a recognition of improving technical momentum and solid long-term fundamentals. Investors should weigh the risks posed by high promoter share pledging and valuation premiums against the company’s growth prospects and market-beating returns.

Overall, the Hold rating indicates that Nuvama Wealth Management Ltd is positioned for potential moderate gains, supported by improving technicals and steady financial trends, but with caution warranted due to valuation and risk factors.

Summary of Rating Change

The upgrade from Sell to Hold on 28 Jan 2026 was driven by:

• Technical Improvement: Shift from sideways to mildly bullish trend, supported by daily moving averages and mixed but improving momentum indicators.


• Valuation Considerations: Despite a very expensive P/B ratio of 6.3 and PEG of 2.1, valuation is supported by strong growth metrics.


• Financial Trend: Flat quarterly earnings but strong long-term operating profit growth of 37.08% annually and ROE near 27%.


• Quality Factors: Robust fundamentals tempered by high promoter share pledging (62.8%), adding risk in volatile markets.

This comprehensive analysis by MarketsMOJO underscores the nuanced nature of the upgrade, balancing technical optimism with fundamental realities.

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