Surana Telecom and Power: Analytical Review Highlights Key Evaluation Shifts

Technical Trends Signal a Mildly Bullish Outlook

The technical perspective on Surana Telecom and Power has shifted towards a cautiously optimistic stance. Weekly and monthly Bollinger Bands indicate a bullish pattern, suggesting that price volatility is currently supporting upward momentum. Daily moving averages also align with this mildly bullish trend, reinforcing the short-term positive sentiment.

However, some technical indicators remain subdued. The Moving Average Convergence Divergence (MACD) on both weekly and monthly charts continues to show a mildly bearish tone, while the Know Sure Thing (KST) oscillator reflects similar caution. Relative Strength Index (RSI) and On-Balance Volume (OBV) metrics do not present clear signals, indicating a lack of strong directional conviction from market participants.

Overall, the technical landscape portrays a market in transition, with recent price action supporting a mild bullish tilt but tempered by mixed momentum indicators.

Valuation and Market Performance in Context

Surana Telecom and Power’s current market price stands at ₹21.00, with a day’s trading range between ₹20.26 and ₹21.27. The stock’s 52-week high is ₹29.32, while the low is ₹15.50, indicating a considerable trading band over the past year. The recent day change of 4.43% reflects active market interest.

When compared with the broader Sensex index, Surana Telecom and Power’s returns present a mixed picture. Over the past week, the stock recorded a 12.00% return, significantly outpacing the Sensex’s 0.87%. However, over the one-month period, the stock’s return was -2.37%, while the Sensex gained 2.03%. Year-to-date figures show the stock down by 10.26%, contrasting with the Sensex’s 9.60% rise. Over longer horizons, the stock has outperformed the Sensex substantially, with a three-year return of 93.73% versus 35.33% for the index, and a five-year return of 441.24% compared to 91.78% for the Sensex.

This divergence between short-term underperformance and long-term outperformance highlights the stock’s volatility and cyclical nature within the power sector.

Financial Trends Reflect Flat to Challenging Performance

Recent quarterly results for Q2 FY25-26 indicate a flat financial performance for Surana Telecom and Power. The Profit After Tax (PAT) for the quarter was ₹0.76 crore, representing a decline of 66.1% compared to the previous period. Operating cash flow for the year stood at ₹3.50 crore, marking the lowest level recorded in recent years. Additionally, the debtors turnover ratio for the half-year was 2.64 times, also at a low point.

Long-term financial trends reveal a concerning trajectory. Operating profits have shown a compound annual growth rate (CAGR) of -207.28% over the last five years, signalling persistent challenges in core profitability. The company’s ability to service debt is under pressure, with an average EBIT to interest ratio of -1.12, indicating that earnings before interest and tax are insufficient to cover interest expenses.

Return on equity (ROE) averages 7.08%, suggesting modest profitability relative to shareholders’ funds. Despite a 127.7% rise in profits over the past year, the stock’s price appreciation of 4.22% during the same period points to a disconnect between earnings growth and market valuation.

Quality Assessment and Risk Considerations

Surana Telecom and Power’s quality parameters reflect a cautious stance. The company’s long-term fundamental strength is weak, as evidenced by negative operating profit growth and limited debt servicing capacity. The stock’s valuation appears risky relative to its historical averages, with a price-earnings-growth (PEG) ratio of 0.1, which may indicate undervaluation but also raises questions about sustainability.

Majority ownership remains with promoters, which can provide stability but also concentrates control. Investors should weigh the company’s financial challenges against its potential for recovery and sector dynamics.

Implications for Investors and Market Outlook

The recent revision in Surana Telecom and Power’s evaluation reflects a complex interplay of technical signals, valuation metrics, financial performance, and quality indicators. While technical trends suggest a mild bullishness, fundamental challenges persist, particularly in profitability and debt servicing.

Investors should consider the stock’s historical outperformance over multi-year periods alongside its recent volatility and flat quarterly results. The divergence between earnings growth and price movement warrants careful analysis, especially given the company’s sector exposure and competitive environment.

Market participants may find value in monitoring ongoing financial disclosures and technical developments to gauge the sustainability of current trends. The company’s promoter-backed ownership structure adds a layer of governance stability, but the financial metrics call for prudence.

Summary of Key Evaluation Shifts

In summary, the revision in Surana Telecom and Power’s market assessment is driven by:

• Technical indicators showing a shift from mildly bearish to mildly bullish patterns, supported by Bollinger Bands and moving averages.


• Valuation metrics reflecting a stock price trading within a wide range, with recent returns diverging from broader market indices.


• Financial trends indicating flat quarterly performance, negative long-term operating profit growth, and constrained debt servicing ability.


• Quality considerations highlighting modest profitability and risk factors associated with valuation and operational challenges.

These factors collectively inform the current market perspective on Surana Telecom and Power, underscoring the importance of a balanced and data-driven approach to investment decisions in the power sector.

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