Technical Indicators Signal Renewed Momentum
One of the primary drivers behind the recent shift in market assessment for Vivid Global Industries is the change in its technical trend. The stock’s technical outlook has moved from a mildly bullish stance to a more pronounced bullish trend. Weekly technical indicators such as the Moving Average Convergence Divergence (MACD) and Bollinger Bands reflect a bullish sentiment, while monthly MACD remains mildly bullish and Bollinger Bands indicate a sideways movement. Daily moving averages also support this positive technical momentum.
However, some mixed signals persist. The Relative Strength Index (RSI) on both weekly and monthly charts does not currently indicate a clear signal, and the Know Sure Thing (KST) indicator shows bullishness on a weekly basis but bearish tendencies monthly. Dow Theory analysis reveals no clear trend weekly but a mildly bullish stance monthly. These mixed technical signals suggest cautious optimism among traders and analysts.
Reflecting this technical shift, Vivid Global Industries’ stock price closed at ₹18.10, up from the previous close of ₹16.99, marking a daily gain of 6.53%. The stock’s 52-week range spans from ₹12.18 to ₹22.49, indicating room for potential price movement within this band.
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Valuation Reflects Fair Pricing Amid Peer Discount
From a valuation perspective, Vivid Global Industries presents a relatively fair profile. The company’s Price to Book Value stands at 1.1, suggesting that the stock is trading close to its book value. This valuation is modest when compared to the average historical valuations of its peers within the commodity chemicals sector, where the stock appears to be trading at a discount.
The company’s Return on Equity (ROE) is recorded at 3.2%, indicating moderate profitability relative to shareholders’ equity. While this figure is not indicative of high returns, it aligns with the company’s current valuation and financial performance. The Price/Earnings to Growth (PEG) ratio of 0.5 further suggests that the stock’s valuation is reasonable relative to its earnings growth prospects.
Financial Trends Show Mixed Signals with Recent Quarterly Strength
Examining the financial trends, Vivid Global Industries has demonstrated positive results in the recent quarter ending September 2025. Net sales for the quarter reached ₹13.92 crores, marking the highest quarterly sales figure recorded by the company. Operating cash flow for the fiscal year stands at ₹2.18 crores, also the highest to date, while Profit Before Depreciation, Interest, and Taxes (PBDIT) for the quarter was ₹0.59 crores.
Despite these encouraging quarterly figures, the company’s longer-term financial trajectory presents challenges. Over the past five years, operating profits have shown a compound annual growth rate (CAGR) of -18.17%, indicating a decline in profitability over this period. Additionally, the company’s ability to service debt is constrained, with an average EBIT to interest coverage ratio of 0.74, reflecting limited capacity to meet interest obligations comfortably.
Furthermore, the average Return on Equity over recent years has been 4.84%, signalling relatively low profitability per unit of shareholders’ funds. These factors contribute to a cautious view of the company’s fundamental strength despite recent quarterly improvements.
Performance Against Benchmarks Highlights Underperformance
When compared to broader market indices, Vivid Global Industries has underperformed over multiple time horizons. The stock’s return over the past year is -6.22%, contrasting with the Sensex’s 7.01% gain during the same period. Year-to-date returns also show a negative 11.27% for the stock, while the Sensex recorded a positive 9.56%.
Longer-term comparisons reveal a similar trend. Over three years, the stock has declined by 34.66%, whereas the Sensex has appreciated by 37.43%. Even over a five-year span, the stock’s return of 16.77% lags behind the Sensex’s 93.43%. However, over a decade, Vivid Global Industries has generated an 81.45% return, which, while positive, remains below the Sensex’s 229.79% growth.
This consistent underperformance against benchmark indices and sector peers underscores the challenges faced by the company in delivering sustained shareholder value.
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Quality Parameters and Shareholding Structure
In terms of quality, Vivid Global Industries exhibits a mixed profile. The company’s financial fundamentals reveal weaknesses in long-term growth and debt servicing ability, which temper the overall quality assessment. The average profitability metrics suggest modest returns on equity, while the operating profit trend over five years points to challenges in sustaining growth.
Shareholding patterns indicate that the majority of shares are held by non-institutional investors, which may influence liquidity and market dynamics. This ownership structure can affect the stock’s responsiveness to market developments and corporate governance considerations.
Summary and Investor Considerations
The recent revision in the market assessment of Vivid Global Industries reflects a nuanced picture. Technical indicators have shifted towards a more bullish outlook, supported by positive short-term price movements and momentum signals. Valuation metrics suggest the stock is trading at a fair price relative to book value and peers, with a reasonable PEG ratio indicating earnings growth potential.
Financially, the company has posted its highest quarterly sales and operating cash flow figures recently, signalling some operational strength. However, longer-term trends in profitability and debt servicing remain areas of concern, compounded by consistent underperformance relative to benchmark indices over multiple periods.
Investors analysing Vivid Global Industries should weigh the improved technical momentum and recent quarterly results against the backdrop of subdued long-term financial growth and benchmark underperformance. This balanced perspective is essential for informed decision-making in the commodity chemicals sector.
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