Current Rating and Its Implications
MarketsMOJO’s 'Sell' rating on Synergy Green Industries 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 term. This rating was assigned on 14 Nov 2025, following a comprehensive review of the company’s performance and outlook. Investors should understand that this recommendation is based on a holistic assessment of multiple factors, including quality, valuation, financial trends, and technical indicators, all of which are updated to reflect the situation as of 01 January 2026.
Quality Assessment: Average Fundamentals Amid Challenges
As of 01 January 2026, Synergy Green Industries Ltd exhibits an average quality grade. The company’s ability to service its debt remains a concern, with an EBIT to Interest coverage ratio averaging only 1.68 times. This indicates limited cushion to meet interest obligations comfortably, raising questions about financial stability. Additionally, the latest quarterly results reveal a decline in operating profit by 11.03%, accompanied by a 21.5% drop in net sales to ₹72.00 crores compared to the previous four-quarter average. Profit before tax excluding other income has also fallen sharply by 83.3% to ₹0.96 crore. These figures highlight operational pressures that weigh on the company’s quality metrics.
Valuation: Attractive but Reflective of Risks
Despite the operational challenges, the valuation grade for Synergy Green Industries Ltd is currently attractive. This suggests that the stock price may be trading at a discount relative to its intrinsic value or sector benchmarks, potentially offering value for investors willing to accept the associated risks. However, the attractive valuation is tempered by the company’s financial difficulties and subdued growth prospects, which justify the cautious rating.
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- - Fundamental Analysis
- - Technical Signals
- - Peer Comparison
Financial Trend: Very Negative Outlook
The financial trend for Synergy Green Industries Ltd is categorised as very negative as of 01 January 2026. The company’s recent quarterly performance underscores this, with significant declines in key profitability metrics and sales volumes. The operating profit to interest coverage ratio has dropped to a low of 1.98 times, signalling increased financial strain. These trends suggest that the company is currently facing headwinds that could impact its ability to generate sustainable earnings growth in the near future.
Technical Analysis: Mildly Bullish but Insufficient to Offset Risks
From a technical perspective, the stock shows a mildly bullish grade, indicating some positive momentum in price action. However, this technical optimism is not strong enough to outweigh the fundamental and financial concerns. The stock’s recent price movements include a 0.3% decline on the latest trading day, with a one-month drop of 7.71% and a three-month decline of 5.06%. Despite a 1-year return of 11.97%, the short-term technical signals do not provide a compelling case for immediate buying, especially given the underlying financial weaknesses.
Market Participation and Investor Sentiment
Another noteworthy aspect is the absence of domestic mutual fund holdings in Synergy Green Industries Ltd. Given that mutual funds often conduct thorough research and due diligence, their lack of investment may reflect concerns about the company’s valuation, business model, or growth prospects. This absence of institutional support can influence market sentiment and liquidity, further justifying a cautious stance for retail investors.
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What This Rating Means for Investors
For investors, the 'Sell' rating on Synergy Green Industries Ltd serves as a signal to exercise caution. It suggests that the stock may face continued challenges in the near term, with risks outweighing potential rewards based on current data. Investors holding the stock might consider reviewing their positions in light of the company’s financial stress and operational setbacks. Prospective buyers should weigh the attractive valuation against the negative financial trends and limited institutional interest before committing capital.
Summary
In summary, Synergy Green Industries Ltd’s current 'Sell' rating by MarketsMOJO, updated on 14 Nov 2025, reflects a comprehensive evaluation of the company’s present-day fundamentals, valuation, financial trends, and technical outlook as of 01 January 2026. While the stock’s valuation appears attractive, significant financial weaknesses and operational declines underpin the cautious recommendation. The mildly bullish technical signals provide limited comfort amid these challenges, and the lack of domestic mutual fund participation further emphasises investor wariness.
Investors should closely monitor upcoming quarterly results and any strategic initiatives by the company that could improve its financial health and operational performance. Until then, the 'Sell' rating advises prudence and careful consideration of risk versus reward.
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