Current Rating and Its Significance
MarketsMOJO’s 'Hold' rating for Suratwwala Business Group Ltd indicates a neutral stance on the stock, suggesting that investors should neither aggressively buy nor sell at this juncture. This rating reflects a balanced view of the company’s prospects, considering its strengths and challenges across multiple parameters. The rating was revised from 'Sell' to 'Hold' on 24 February 2026, accompanied by a Mojo Score increase from 47 to 52, signalling a modest improvement in the company’s overall profile.
Quality Assessment
As of 27 February 2026, Suratwwala Business Group Ltd holds an average quality grade. The company demonstrates a strong capacity to service its debt, with a Debt to EBITDA ratio of 1.17 times, which is considered low and indicates prudent financial management. This suggests that the company is not over-leveraged and can comfortably meet its interest and principal obligations, a positive sign for risk-averse investors.
However, the company’s long-term growth prospects appear modest, with operating profit growing at an annual rate of 14.17% over the past five years. While this growth is positive, it is not particularly robust compared to high-growth peers in the realty sector. The company’s ability to sustain and improve profitability will be crucial for enhancing its quality rating in the future.
Valuation Considerations
Valuation remains a key concern for Suratwwala Business Group Ltd, which is currently graded as very expensive. The stock trades at an Enterprise Value to Capital Employed (EV/CE) ratio of 4.1, which is high relative to its historical averages and peer group benchmarks. This elevated valuation suggests that the market has priced in significant expectations for future growth and profitability.
Despite this, the stock is trading at a discount compared to its peers’ average historical valuations, indicating some relative value. The company’s Price/Earnings to Growth (PEG) ratio stands at a low 0.1, reflecting that earnings growth has outpaced the stock price increase, which could be attractive to value-conscious investors. Nevertheless, the 'very expensive' valuation grade advises caution, as the premium pricing may limit upside potential unless the company delivers consistent earnings growth.
Financial Trend and Performance
The financial trend for Suratwwala Business Group Ltd is rated outstanding, highlighting strong recent performance metrics. As of 27 February 2026, the company has reported a remarkable 62.01% growth in net sales, with the latest quarterly net sales reaching ₹42.09 crores, the highest recorded to date. Profitability metrics have also improved significantly, with quarterly PBDIT at ₹15.49 crores and PBT less other income at ₹14.95 crores, both at record highs.
These results reflect a positive momentum, supported by three consecutive quarters of positive earnings. Over the past year, despite the stock price declining by 29.15%, the company’s profits have surged by 208.7%, underscoring a disconnect between market sentiment and operational performance. This divergence may present an opportunity for investors who focus on fundamentals rather than short-term price movements.
Technical Analysis
From a technical perspective, Suratwwala Business Group Ltd currently holds a bearish grade. The stock’s recent price performance has been weak, with a one-month decline of 13.23% and a six-month drop of 24.07%. Year-to-date, the stock has fallen 15.54%, reflecting downward pressure in the short to medium term.
Despite a positive one-day gain of 2.48% on 27 February 2026, the overall technical indicators suggest caution for traders relying on chart patterns and momentum. The bearish technical grade implies that the stock may face resistance levels and volatility before any sustained upward trend can be confirmed.
Additional Market Insights
Suratwwala Business Group Ltd remains a microcap company within the realty sector, which often entails higher volatility and lower liquidity compared to larger peers. Notably, domestic mutual funds currently hold no stake in the company, which may indicate limited institutional confidence or a lack of in-depth research coverage. This absence of mutual fund participation could be due to valuation concerns or the company’s size and market presence.
Investors should weigh this factor carefully, as institutional ownership often provides a degree of stability and validation of a company’s prospects.
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What the Hold Rating Means for Investors
For investors, the 'Hold' rating on Suratwwala Business Group Ltd suggests a cautious approach. The company’s strong financial trend and ability to service debt provide a solid foundation, but the expensive valuation and bearish technical outlook temper enthusiasm. Investors may consider maintaining existing positions while monitoring the company’s operational performance and market conditions closely.
Those looking for entry points might wait for clearer signs of technical recovery or valuation moderation before committing fresh capital. Conversely, investors with a longer-term horizon could view the current dip in stock price as an opportunity to accumulate shares at a relative discount, given the company’s improving profitability.
Summary
In summary, Suratwwala Business Group Ltd’s current 'Hold' rating by MarketsMOJO, updated on 24 February 2026, reflects a balanced assessment of its quality, valuation, financial trend, and technical factors as of 27 February 2026. The company exhibits strong financial health and impressive recent earnings growth but faces valuation challenges and technical headwinds. Investors should weigh these factors carefully in line with their risk tolerance and investment objectives.
Key Metrics at a Glance (As of 27 February 2026)
- Mojo Score: 52.0 (Hold)
- Debt to EBITDA Ratio: 1.17 times (Low)
- Operating Profit Growth (5 years CAGR): 14.17%
- Net Sales Growth (Latest Quarter): 62.01%
- Quarterly Net Sales: ₹42.09 crores (Highest)
- Quarterly PBDIT: ₹15.49 crores (Highest)
- Quarterly PBT less Other Income: ₹14.95 crores (Highest)
- Return on Capital Employed (ROCE): 18.8%
- Enterprise Value to Capital Employed: 4.1 (Very Expensive)
- PEG Ratio: 0.1
- Stock Returns: 1D +2.48%, 1M -13.23%, 6M -24.07%, 1Y -29.15%
Investors should continue to monitor Suratwwala Business Group Ltd’s quarterly results and market developments to reassess the stock’s outlook and adjust their portfolios accordingly.
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