Raymond Ltd is Rated Hold by MarketsMOJO

Current Rating and Its Significance

MarketsMOJO’s 'Hold' rating for Raymond Ltd indicates a neutral stance, suggesting that investors should neither aggressively buy nor sell the stock at this time. This rating reflects a balance of strengths and weaknesses across key evaluation parameters, signalling that the stock may offer moderate returns but also carries certain risks that warrant caution. The rating was adjusted on 10 February 2026, moving from a previous 'Sell' grade, reflecting an improvement in the company’s overall profile.

How Raymond Ltd Looks Today: Quality Assessment

As of 12 February 2026, Raymond Ltd demonstrates a good quality grade. This is supported by a notably high return on equity (ROE) of 35.83%, indicating efficient management and effective utilisation of shareholder capital. Such a strong ROE is a positive signal for investors, as it suggests the company is generating substantial profits relative to equity invested.

However, the company’s long-term growth has been disappointing, with net sales declining at an annualised rate of -8.40% over the past five years. This negative sales trajectory tempers the otherwise strong quality metrics and highlights challenges in expanding the business or maintaining market share.

Valuation: Attractive but Reflective of Risks

Raymond Ltd’s valuation is currently very attractive. The stock trades at a price-to-book (P/B) ratio of 0.8, which is below the average historical valuations of its peers. This discount suggests the market is pricing in some concerns about the company’s future prospects. The company’s ROE of 51.9% relative to this valuation further underscores the potential value embedded in the stock.

Despite this, the stock has delivered a negative return of -19.71% over the past year, with profits declining by -20.8% during the same period. The PEG ratio stands at zero, reflecting flat or negative earnings growth expectations. These factors indicate that while the stock may be undervalued, investors should be mindful of the underlying earnings challenges.

Financial Trend: Flat Performance Amidst Mixed Signals

The financial trend for Raymond Ltd is currently flat. The latest quarterly results show a subdued performance, with earnings per share (EPS) at a low of Rs 0.54. Interest expenses for the nine months ended December 2025 have increased by 21.96% to Rs 60.64 crores, signalling rising financial costs that could pressure profitability.

Non-operating income constitutes a significant 95.60% of profit before tax (PBT), indicating that core business operations are not the primary drivers of profitability. This reliance on non-operating income may raise concerns about the sustainability of earnings going forward.

Technicals: Bearish Momentum

From a technical perspective, Raymond Ltd is currently graded as bearish. The stock has underperformed the benchmark BSE500 index consistently over the past three years. Its returns over various periods as of 12 February 2026 are as follows: -0.87% in one day, -0.44% over one week, -0.01% in one month, -24.80% in three months, -34.30% in six months, -5.28% year-to-date, and -19.71% over the last year.

This persistent underperformance reflects weak market sentiment and selling pressure, which may be influenced by the company’s flat financial trends and declining sales. Additionally, institutional investors have reduced their holdings by 2.7% in the previous quarter, now collectively owning 14.44% of the company. This decline in institutional participation could signal reduced confidence among sophisticated investors.

Investor Takeaway

For investors, the 'Hold' rating on Raymond Ltd suggests a cautious approach. The company’s strong management efficiency and attractive valuation offer some upside potential, but these are offset by flat financial trends, declining sales, and bearish technical signals. The stock’s current discount to book value may appeal to value-oriented investors willing to tolerate short-term volatility, but the lack of growth and weak price momentum warrant careful monitoring.

Investors should consider Raymond Ltd as a stock to watch rather than an immediate buy or sell. Those holding the stock may choose to maintain their positions while awaiting clearer signs of financial recovery or improved market sentiment. Prospective buyers might prefer to wait for more positive technical signals or evidence of a turnaround in sales and earnings before committing capital.

Summary of Key Metrics as of 12 February 2026

Raymond Ltd’s Mojo Score stands at 52.0, reflecting its 'Hold' grade. The company’s quality grade is good, valuation grade very attractive, financial grade flat, and technical grade bearish. Despite a high ROE of 35.83%, the company faces challenges with declining sales and flat earnings. The stock’s recent price action and institutional investor behaviour further underline the need for a measured investment approach.

In conclusion, Raymond Ltd’s current 'Hold' rating by MarketsMOJO is a reflection of a mixed outlook. Investors should weigh the company’s strong management efficiency and valuation against its subdued growth and technical weakness when making portfolio decisions.

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