Current Rating and Its Significance
MarketsMOJO currently assigns Supreme Petrochem Ltd a 'Sell' rating, indicating a cautious stance for investors considering this stock. This rating suggests that, based on a comprehensive evaluation of multiple factors, the stock is expected to underperform relative to the broader market or its sector peers in the near term. Investors are advised to carefully assess their exposure to this stock and consider alternative opportunities that may offer better risk-adjusted returns.
Rating Update Context
The 'Sell' rating was established on 03 November 2025, when the Mojo Score for Supreme Petrochem Ltd declined by 18 points, moving from 61 (Hold) to 43 (Sell). This shift reflected a reassessment of the company's fundamentals, valuation, financial trends, and technical indicators at that time. It is important to note that while the rating date is fixed, the data and analysis presented here are current as of 20 January 2026, ensuring investors receive the most up-to-date information.
Quality Assessment
As of 20 January 2026, Supreme Petrochem Ltd maintains an excellent quality grade. This indicates that the company demonstrates strong operational efficiency, robust management practices, and a solid business model within the petrochemicals sector. High-quality companies typically exhibit consistent earnings, competitive advantages, and sound corporate governance. Despite the current rating, the quality grade suggests that the company’s core business fundamentals remain intact, which could provide a foundation for future recovery if other factors improve.
Valuation Perspective
The stock is currently rated as having an attractive valuation. This implies that, based on price-to-earnings ratios, price-to-book values, or other valuation metrics, Supreme Petrochem Ltd is trading at a discount relative to its intrinsic worth or sector averages. For value-oriented investors, this could signal a potential opportunity to acquire shares at a favourable price. However, valuation alone does not guarantee positive returns, especially if other financial or technical factors weigh negatively on the stock.
Financial Trend Analysis
The company’s financial grade is negative as of today. Recent quarterly results highlight a significant decline in key financial metrics. Net sales for the quarter ending September 2025 stood at ₹1,100.15 crores, down 24.6% compared to the previous four-quarter average. Profit before tax (excluding other income) fell by 44.0% to ₹56.30 crores, while net profit after tax dropped 44.8% to ₹48.20 crores. These figures indicate a weakening financial trend, reflecting challenges in revenue generation and profitability that are likely contributing to the cautious rating.
Technical Outlook
The technical grade for Supreme Petrochem Ltd is currently bearish. This suggests that recent price movements and chart patterns indicate downward momentum. The stock has underperformed the broader market significantly over the past year, with a 1-year return of -15.21% compared to the BSE500 index’s positive 6.06% return. Shorter-term price trends also show weakness, with the stock declining 12.34% over the past month and 28.60% over the past three months. Such technical signals often reflect investor sentiment and can influence near-term price action.
Performance Summary as of 20 January 2026
Currently, Supreme Petrochem Ltd’s stock price shows a mixed picture. While it gained 2.74% on the most recent trading day, the overall trend remains negative. Year-to-date, the stock has declined 14.86%, and over six months, it has fallen 32.70%. These returns underscore the challenges faced by the company and the sector, reinforcing the rationale behind the 'Sell' rating.
Implications for Investors
For investors, the 'Sell' rating signals caution. Despite the company’s excellent quality and attractive valuation, the negative financial trends and bearish technical outlook suggest that the stock may continue to face headwinds. Investors should weigh these factors carefully, considering their risk tolerance and investment horizon. Those holding the stock may consider reducing exposure, while prospective buyers might await signs of financial recovery and technical stabilisation before entering.
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Sector and Market Context
The petrochemicals sector has faced volatility amid fluctuating raw material costs and global demand uncertainties. Supreme Petrochem Ltd, classified as a small-cap within this sector, has been particularly impacted by these dynamics. While the broader market, represented by the BSE500, has delivered modest gains over the past year, the stock’s underperformance highlights company-specific challenges. Investors should consider sector trends alongside company fundamentals when making decisions.
Conclusion
In summary, Supreme Petrochem Ltd’s 'Sell' rating by MarketsMOJO reflects a balanced assessment of its current standing. The company’s excellent quality and attractive valuation are offset by deteriorating financial results and a bearish technical outlook. As of 20 January 2026, the stock’s performance metrics and market sentiment suggest caution for investors. Monitoring upcoming quarterly results and sector developments will be crucial for reassessing the stock’s outlook in the coming months.
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