Team India Guaranty Ltd is Rated Sell

Current Rating and Its Implications

The 'Sell' rating assigned to Team India Guaranty Ltd indicates a cautious stance for investors considering this microcap Non-Banking Financial Company (NBFC). This recommendation suggests that the stock may underperform relative to the broader market or its sector peers in the near to medium term. Investors should weigh this advice carefully, especially given the company's financial and valuation profile as it stands today.

Quality Assessment

As of 05 January 2026, the company’s quality grade remains below average. This is primarily due to its weak long-term fundamental strength. The average Return on Equity (ROE) stands at a modest 5.90%, reflecting limited profitability relative to shareholder equity. Furthermore, the company’s net sales have grown at an annual rate of just 2.72%, while operating profit has increased by 8.62% annually. These figures indicate subdued growth and operational efficiency challenges, which weigh on the overall quality assessment.

Valuation Considerations

Valuation is a critical factor in the current rating. Team India Guaranty Ltd is classified as very expensive, trading at a Price to Book Value (P/BV) of 5.4. This premium valuation is significant when compared to its peers’ historical averages, suggesting that the stock price may be stretched relative to the company’s intrinsic worth. Despite this, the stock has delivered a remarkable 80.70% return over the past year as of 05 January 2026, with profits rising by 30.4%. However, the Price/Earnings to Growth (PEG) ratio of 3.4 further underscores the expensive nature of the stock, signalling that earnings growth may not fully justify the current price level.

Financial Trend Analysis

The financial grade for Team India Guaranty Ltd is currently flat, indicating a lack of significant improvement or deterioration in its financial health. The company reported flat results in September 2025, which aligns with the broader trend of modest growth. While the operating profit growth rate of 8.62% is positive, it is not sufficiently robust to drive a stronger financial trend grade. Investors should note that the company’s financial trajectory remains steady but uninspiring, which contributes to the cautious rating.

Technical Outlook

From a technical perspective, the stock exhibits a mildly bullish grade. Recent price movements show mixed signals: a 1-day change of 0.00%, a 1-week decline of 4.74%, but a 1-month gain of 4.71% and a 3-month increase of 10.48%. Notably, the 6-month return is a strong 69.24%, and the 1-year return stands at 80.70%. Despite these gains, the year-to-date return is slightly negative at -0.68%, suggesting some short-term volatility. The mildly bullish technical grade indicates that while momentum exists, it may not be strong enough to offset the fundamental and valuation concerns.

Investor Takeaway

For investors, the 'Sell' rating on Team India Guaranty Ltd signals caution. The company’s below-average quality, very expensive valuation, flat financial trend, and only mildly bullish technical outlook collectively suggest that the stock may face challenges sustaining its recent gains. While the impressive returns over the past year are noteworthy, they appear to be priced in, given the elevated valuation metrics. Prospective investors should carefully consider whether the current price adequately reflects the company’s growth prospects and risks.

Summary of Key Metrics as of 05 January 2026

Team India Guaranty Ltd’s current Mojo Score is 37.0, reflecting its 'Sell' grade, an improvement from the previous 'Strong Sell' rating. The company operates as a microcap NBFC, with a market capitalisation that remains modest. Its long-term growth rates for net sales and operating profit remain subdued, while valuation metrics indicate a premium pricing environment. The stock’s recent price performance has been strong over the medium term but shows signs of short-term volatility. These factors collectively inform the current recommendation and provide a comprehensive view for investors assessing the stock today.

Conclusion

In conclusion, Team India Guaranty Ltd’s 'Sell' rating by MarketsMOJO reflects a balanced assessment of its current fundamentals, valuation, financial trends, and technical outlook. Investors should approach the stock with caution, recognising that while recent returns have been impressive, the underlying financial and valuation metrics suggest limited upside potential relative to risk. Continuous monitoring of the company’s performance and market conditions will be essential for making informed investment decisions going forward.

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