Current Rating Overview
MarketsMOJO’s 'Sell' rating on Softsol India Ltd indicates a cautious stance for investors, suggesting that the stock may underperform relative to the broader market or its sector peers in the near to medium term. This recommendation is based on a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. The rating was adjusted on 17 Dec 2025, when the Mojo Score declined from 51 to 46, signalling a shift in the stock’s risk-reward profile.
How Softsol India Ltd Looks Today
As of 23 January 2026, Softsol India Ltd is classified as a microcap company operating within the Computers - Software & Consulting sector. The current Mojo Score of 46 places it in the 'Sell' grade category, reflecting concerns about its overall investment appeal.
Quality Assessment
The company’s quality grade is assessed as average. This is largely influenced by its management efficiency and profitability metrics. Currently, Softsol India Ltd reports a Return on Equity (ROE) of 8.60%, which is considered low, indicating limited profitability generated from shareholders’ funds. This level of ROE suggests that the company is not optimally utilising its equity base to generate earnings, which may be a concern for investors seeking robust returns.
Valuation Perspective
Despite the challenges in quality, the valuation grade is very attractive. This implies that the stock is trading at a relatively low price compared to its earnings, book value, or other fundamental metrics. For value-oriented investors, this could present an opportunity to acquire shares at a discount. However, attractive valuation alone does not guarantee positive returns if other factors such as growth and technical trends remain weak.
Financial Trend Analysis
The financial grade is positive, indicating some favourable aspects in the company’s recent financial performance. However, this is tempered by the long-term sales trend, which shows a negative compound annual growth rate of -8.55% over the past five years. This decline in net sales points to challenges in sustaining revenue growth, which is critical for long-term value creation. Additionally, the stock has delivered a negative return of -29.99% over the last year, underperforming the BSE500 index over multiple time frames including one year, three months, and three years.
Technical Outlook
The technical grade is bearish, reflecting negative momentum in the stock price. Recent price movements show a decline of -5.72% in a single day and a one-month drop of -11.79%. The bearish technical signals suggest that market sentiment remains weak, and the stock may face further downward pressure in the short term.
Stock Returns and Market Performance
As of 23 January 2026, Softsol India Ltd’s stock returns have been disappointing across all measured periods. The year-to-date return stands at -11.05%, while the six-month return is -9.05%. Over three months, the stock has fallen by -16.71%, and the one-week return is -8.63%. These figures highlight sustained underperformance relative to broader market indices and sector benchmarks, reinforcing the cautious stance reflected in the current rating.
Investor Implications of the 'Sell' Rating
For investors, the 'Sell' rating suggests that Softsol India Ltd may not be an attractive holding at present. The combination of average quality, very attractive valuation, positive yet challenged financial trends, and bearish technicals indicates a complex risk profile. While the low valuation might tempt value investors, the ongoing decline in sales and weak price momentum warrant prudence. Investors should carefully weigh these factors against their risk tolerance and investment horizon before considering exposure to this stock.
Transformation in full progress! This Micro Cap from Auto Ancillary just achieved sustainable profitability after tough times. Be early to witness this powerful comeback story!
- - Sustainable profitability reached
- - Post-turnaround strength
- - Comeback story unfolding
Summary of Key Metrics
Softsol India Ltd’s current profile as of 23 January 2026 can be summarised as follows:
- Mojo Score: 46.0 (Sell grade)
- Return on Equity: 8.60% (low profitability)
- Net Sales Growth (5 years CAGR): -8.55%
- Stock Returns (1 year): -29.99%
- Technical Grade: Bearish
- Valuation Grade: Very Attractive
These metrics collectively explain the rationale behind the current 'Sell' rating, highlighting the challenges the company faces in growth and market sentiment despite its appealing valuation.
Looking Ahead
Investors should monitor Softsol India Ltd’s future quarterly results and management commentary closely to assess any changes in operational efficiency or strategic direction that could improve its quality and financial trend scores. Additionally, shifts in technical indicators and market sentiment will be crucial in determining the stock’s near-term trajectory.
In conclusion, while Softsol India Ltd’s valuation remains attractive, the prevailing quality concerns, negative sales growth, and bearish technical outlook justify a cautious approach. The 'Sell' rating serves as a signal for investors to consider alternative opportunities or to closely watch for signs of turnaround before committing capital.
Unlock special upgrade rates for a limited period. Start Saving Now →
