Understanding the Current Rating
The Strong Sell rating assigned to Riddhi Siddhi Gluco Biols Ltd indicates a cautious stance for investors, signalling significant concerns across multiple evaluation parameters. This rating suggests that the stock is expected to underperform the broader market and carries elevated risks. Investors should carefully consider these factors before making investment decisions.
Quality Assessment
As of 25 January 2026, the company’s quality grade remains below average. Over the past five years, Riddhi Siddhi Gluco Biols Ltd has experienced a negative compound annual growth rate (CAGR) of -14.03% in net sales, reflecting a persistent decline in its core business operations. The firm’s ability to service debt is notably weak, with an average EBIT to interest ratio of -1.18, indicating that earnings before interest and taxes are insufficient to cover interest expenses. Furthermore, the company has reported losses, resulting in a negative return on capital employed (ROCE). These factors collectively highlight structural weaknesses in the company’s operational and financial health.
Valuation Considerations
The valuation grade for Riddhi Siddhi Gluco Biols Ltd is classified as risky. The stock currently trades at valuations that are unfavourable compared to its historical averages, suggesting that the market perceives elevated uncertainty or deteriorating fundamentals. Over the last year, the stock has delivered a negative return of -13.82%, while profits have declined by approximately -18.7%. This combination of falling earnings and subdued price performance underscores the challenges in justifying a higher valuation multiple at present.
Financial Trend Analysis
The financial trend for the company is negative. The latest quarterly results reveal a continuation of losses, with the company reporting negative earnings before interest, taxes, depreciation and amortisation (EBITDA). Specifically, the profit after tax (PAT) for the nine-month period stands at ₹27.63 crores, reflecting a steep decline of -61.36%. Net sales for the quarter have fallen by -34.36% to ₹32.10 crores, while profit before tax excluding other income (PBT less OI) has deteriorated by -225.00%, registering a loss of ₹4.05 crores. These figures indicate a troubling downward trajectory in both top-line and bottom-line performance.
Technical Outlook
From a technical perspective, the stock is mildly bearish. Recent price movements show a mixed short-term performance with a 1-day decline of -0.30%, but some recovery over the past month with a 10.10% gain. However, the longer-term trend remains weak, with the stock underperforming the BSE500 index over the last three years, one year, and three months. This technical backdrop aligns with the fundamental concerns and supports the cautious rating.
Stock Returns and Market Performance
As of 25 January 2026, Riddhi Siddhi Gluco Biols Ltd’s stock returns present a volatile picture. While the year-to-date (YTD) return is a positive 22.44%, the one-year return is negative at -13.82%. The six-month and three-month returns are also negative, at -16.35% and -5.86% respectively, indicating recent struggles. The one-week return shows a modest recovery of 6.06%. This inconsistency in returns reflects the underlying uncertainty and risk associated with the stock.
Implications for Investors
Investors should interpret the Strong Sell rating as a signal to exercise caution. The combination of weak fundamentals, risky valuation, negative financial trends, and bearish technical indicators suggests that the stock may continue to face headwinds. For risk-averse investors, this rating implies that capital preservation should be prioritised over speculative gains. Those considering exposure to Riddhi Siddhi Gluco Biols Ltd should conduct thorough due diligence and consider the broader market context before committing funds.
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Company Profile and Market Capitalisation
Riddhi Siddhi Gluco Biols Ltd operates within the Trading & Distributors sector and is classified as a microcap company. This classification reflects its relatively small market capitalisation and liquidity profile, which can contribute to higher volatility and risk. Investors should be mindful of the inherent challenges associated with microcap stocks, including limited analyst coverage and potential price swings.
Summary of Key Metrics
To summarise the key metrics as of 25 January 2026:
- Mojo Score: 9.0 (Strong Sell grade)
- Quality Grade: Below average
- Valuation Grade: Risky
- Financial Grade: Negative
- Technical Grade: Mildly bearish
- One-year stock return: -13.82%
- Net sales CAGR (5 years): -14.03%
- PAT (9 months): ₹27.63 crores, down -61.36%
- Net sales (quarterly): ₹32.10 crores, down -34.36%
- PBT less other income (quarterly): -₹4.05 crores, down -225.00%
Conclusion
Riddhi Siddhi Gluco Biols Ltd’s current Strong Sell rating by MarketsMOJO reflects a comprehensive evaluation of its deteriorating fundamentals, risky valuation, negative financial trends, and cautious technical outlook. While the stock has shown some short-term positive price movements, the broader picture remains challenging. Investors should carefully weigh these factors and consider their risk tolerance before engaging with this stock. Continuous monitoring of the company’s financial health and market conditions is advisable to reassess the investment thesis over time.
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