Relicab Cable Manufacturing Ltd is Rated Sell

Current Rating and Its Significance

MarketsMOJO’s 'Sell' rating for Relicab Cable Manufacturing Ltd indicates a cautious stance towards the stock, suggesting that investors should consider reducing exposure or avoiding new purchases at this time. This rating reflects a combination of factors that weigh on the company’s prospects, including quality concerns, valuation attractiveness, financial trends, and technical indicators. The rating was adjusted from 'Strong Sell' to 'Sell' on 29 December 2025, reflecting a modest improvement in the company’s overall mojo score from 29 to 32, yet still signalling significant risks.

Here’s How the Stock Looks Today

As of 28 January 2026, Relicab Cable Manufacturing Ltd remains a microcap player in the Other Electrical Equipment sector, with a mojo grade firmly in the 'Sell' category. The stock’s recent price movements show a 0.75% gain on the day, but this masks a challenging longer-term performance. Over the past year, the stock has delivered a negative return of 51.20%, underperforming broader benchmarks such as the BSE500 index. The year-to-date return also stands at -16.49%, reflecting continued downward pressure.

Quality Assessment

The company’s quality grade is below average, signalling concerns about its operational strength and sustainability. While Relicab has achieved a compound annual growth rate (CAGR) of 13.52% in operating profits over the last five years, this growth has not translated into robust financial health. The ability to service debt is notably weak, with an average EBIT to interest coverage ratio of just 1.47, indicating limited cushion to meet interest obligations. This financial fragility is compounded by the fact that 99.94% of promoter shares are pledged, which can exert additional downward pressure on the stock price during market downturns.

Valuation Perspective

Despite the challenges, the valuation grade for Relicab Cable Manufacturing Ltd is very attractive. This suggests that the stock is trading at a price level that may offer value relative to its earnings and asset base. For value-oriented investors, this could represent a potential entry point, provided the company can address its fundamental weaknesses. However, the attractive valuation must be weighed carefully against the risks posed by the company’s financial and technical outlook.

Financial Trend Analysis

The financial grade is positive, indicating some favourable trends in the company’s recent financial performance. The operating profit growth over five years is a positive sign, but the overall financial health remains fragile due to debt servicing concerns and high promoter pledge levels. The stock’s underperformance relative to the BSE500 index over one year, three months, and three years highlights persistent challenges in delivering shareholder returns.

Technical Outlook

The technical grade is bearish, reflecting negative momentum in the stock’s price action. The stock has declined by 31.08% over the past three months and 51.71% over six months, signalling sustained selling pressure. This bearish technical environment suggests that short-term price recovery may be limited, and investors should exercise caution when considering new positions.

Summary for Investors

In summary, Relicab Cable Manufacturing Ltd’s 'Sell' rating by MarketsMOJO as of 29 December 2025 reflects a balanced view of the company’s current challenges and opportunities. While the valuation appears attractive, the below-average quality, weak debt servicing ability, high promoter pledge, and bearish technical signals caution investors against expecting a swift turnaround. The positive financial trend offers some hope, but overall, the stock remains a risky proposition for investors seeking stability and growth.

Performance and Market Context

Relicab Cable Manufacturing Ltd’s stock performance over various time frames underscores the challenges faced by the company. The one-day gain of 0.75% is a minor positive in an otherwise difficult trend. Over one week, the stock declined by 0.74%, while the one-month return was a steep -18.85%. The three-month and six-month returns of -31.08% and -51.71% respectively highlight sustained selling pressure. Year-to-date, the stock has lost 16.49%, and over the past year, it has declined by 51.20%. These figures illustrate the stock’s underperformance relative to broader market indices and sector peers.

Risks and Considerations

Investors should be mindful of the risks associated with Relicab Cable Manufacturing Ltd. The extremely high promoter share pledge level is a significant red flag, as it may lead to forced selling in adverse market conditions. The company’s weak ability to service debt further exacerbates financial risk. Additionally, the bearish technical outlook suggests limited near-term recovery potential. These factors collectively justify the cautious 'Sell' rating and advise investors to approach the stock with prudence.

Outlook and Strategic Implications

For investors, the current 'Sell' rating implies that Relicab Cable Manufacturing Ltd is not an attractive buy at present. The company’s valuation may tempt value investors, but the underlying quality and technical weaknesses suggest that the stock could remain under pressure. Monitoring improvements in debt servicing capacity, reduction in promoter pledge, and a shift in technical momentum would be critical before reconsidering a more positive stance. Until such developments materialise, a defensive approach is advisable.

Conclusion

Relicab Cable Manufacturing Ltd’s 'Sell' rating as of 29 December 2025, supported by a mojo score of 32, reflects a nuanced assessment of the company’s current standing as of 28 January 2026. While valuation is appealing, the combination of below-average quality, financial fragility, and bearish technical signals warrants caution. Investors should carefully weigh these factors against their risk tolerance and investment horizon before making decisions involving this stock.

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