Shree Rama Multi-Tech Ltd is Rated Hold

Current Rating and Its Significance

MarketsMOJO’s 'Hold' rating for Shree Rama Multi-Tech Ltd indicates a balanced outlook for investors. It suggests that while the stock shows potential for moderate returns, it may not offer significant upside compared to peers or the broader market at this time. Investors are advised to maintain their positions without aggressive buying or selling, considering the company’s present financial health and market conditions.

Here’s How the Stock Looks Today

As of 06 January 2026, Shree Rama Multi-Tech Ltd exhibits a Mojo Score of 65.0, reflecting a moderate investment appeal. This score, which improved by 17 points from 48 at the time of the rating update, supports the 'Hold' recommendation. The company operates within the packaging sector and is classified as a microcap, which often entails higher volatility and risk but also potential for growth.

Quality Assessment

The company’s quality grade is assessed as average. While Shree Rama Multi-Tech Ltd has demonstrated consistent operational performance, certain financial ratios highlight areas of concern. Notably, the Debt to EBITDA ratio stands at a high 4.95 times, indicating a relatively low ability to service debt efficiently. This elevated leverage could constrain financial flexibility and increase risk during economic downturns.

Despite this, the company has maintained a Return on Capital Employed (ROCE) averaging 7.59%, which, although modest, shows some profitability per unit of capital invested. More encouragingly, the latest half-year ROCE has risen to 17.62%, signalling improving capital efficiency in recent periods.

Valuation Considerations

Currently, Shree Rama Multi-Tech Ltd is considered expensive based on valuation metrics. The stock trades at a Price to Book Value of 5.2, which is high relative to typical benchmarks. However, this premium valuation is somewhat justified by the company’s strong return on equity (ROE) of 33.7%, reflecting robust profitability for shareholders.

Moreover, the stock’s Price/Earnings to Growth (PEG) ratio is an attractive 0.1, suggesting that earnings growth significantly outpaces the price paid by investors. This low PEG ratio indicates potential value despite the high book value multiple, especially given the company’s rapid profit expansion.

Financial Trend and Growth Trajectory

The financial trend for Shree Rama Multi-Tech Ltd is positive. The company has reported healthy long-term growth, with operating profit increasing at an annual rate of 47.44%. Over the past year, profits have surged by an impressive 277.1%, while net sales for the latest six months reached ₹117.37 crores, growing at 22.54% year-on-year.

Profit after tax (PAT) for the latest six months stands at ₹14.52 crores, reflecting a 53.00% growth rate. These figures underscore the company’s ability to expand its earnings base consistently, which is a favourable sign for investors seeking growth within the packaging sector.

Technical Outlook

The technical grade for Shree Rama Multi-Tech Ltd is bullish, reflecting positive momentum in the stock price. Recent price movements show strong gains, with the stock appreciating 2.14% in the last trading day and 30.45% over the past month. Over six months, the stock has surged by 62.46%, and the one-year return stands at a robust 40.74%.

These technical indicators suggest that market sentiment towards the stock is favourable, supported by consistent quarterly results and improving fundamentals. However, investors should remain cautious given the stock’s microcap status and valuation premium.

Additional Considerations for Investors

Despite the company’s strong growth and technical momentum, domestic mutual funds currently hold no stake in Shree Rama Multi-Tech Ltd. This absence of institutional ownership may reflect concerns about valuation or business scale, signalling a need for investors to conduct thorough due diligence.

Furthermore, the company has declared positive results for seven consecutive quarters, reinforcing its operational stability. Yet, the relatively high debt levels and average quality grade temper the overall outlook, justifying the 'Hold' rating rather than a more bullish stance.

What This Means for Investors

For investors, the 'Hold' rating on Shree Rama Multi-Tech Ltd suggests a cautious approach. The company’s strong earnings growth and bullish technicals offer upside potential, but elevated debt levels and expensive valuation metrics warrant prudence. Investors already holding the stock may consider maintaining their positions to benefit from ongoing growth, while new investors might wait for more attractive entry points or further clarity on debt management.

Overall, the stock presents a balanced risk-reward profile, with solid operational performance tempered by financial leverage and valuation concerns. Monitoring quarterly results and debt servicing capability will be crucial for assessing future investment decisions.

Summary of Key Metrics as of 06 January 2026

• Mojo Score: 65.0 (Hold)


• Debt to EBITDA Ratio: 4.95 times


• Return on Capital Employed (avg): 7.59%


• Return on Capital Employed (HY): 17.62%


• Return on Equity: 33.7%


• Price to Book Value: 5.2


• Operating Profit Growth (annual): 47.44%


• Profit After Tax Growth (latest six months): 53.00%


• Net Sales Growth (latest six months): 22.54%


• Stock Returns: 1D +2.14%, 1M +30.45%, 6M +62.46%, 1Y +40.74%

Investors should weigh these factors carefully in the context of their portfolio objectives and risk tolerance.

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