Akar Auto Industries Ltd Stock Falls to 52-Week Low of Rs.86.5

Intraday Price Movement and Volatility

On 29 Jan 2026, Akar Auto Industries Ltd experienced notable intraday volatility of 6.74%, with the stock reaching an intraday high of Rs.99, up 4.27%, before sharply declining to the day’s low of Rs.86.5, down 8.9%. This wide price range underscores the unsettled sentiment surrounding the stock. The current price level is substantially below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, indicating a sustained bearish trend.

Market Context and Comparative Performance

While the broader market, represented by the Sensex, showed resilience by gaining 0.27% to trade at 82,566.37 points, it remains 4.35% shy of its 52-week high of 86,159.02. The Sensex’s 50-day moving average remains above its 200-day moving average, signalling a generally positive medium-term market trend. Mega-cap stocks led the market rally, contrasting with the underperformance of mid and small caps, including Akar Auto Industries Ltd.

Over the past year, Akar Auto Industries Ltd’s stock has declined by 29.42%, a stark contrast to the Sensex’s 7.88% gain over the same period. The stock’s 52-week high was Rs.204.6, highlighting the extent of the recent correction.

Financial Performance and Profitability Metrics

The company’s recent quarterly results reveal a subdued financial performance. Net sales for the quarter stood at Rs.87.27 crores, down 6.3% compared to the previous four-quarter average. Profit after tax (PAT) declined sharply to Rs.0.54 crore, a fall of 67.9% relative to the prior four-quarter average. Earnings before interest, depreciation, and taxes (PBDIT) were recorded at Rs.5.42 crore, marking the lowest level in recent quarters.

These figures reflect a contraction in both top-line and bottom-line metrics, contributing to the stock’s downward trajectory. The company’s ability to service its debt remains constrained, with a high Debt to EBITDA ratio of 3.95 times, indicating elevated leverage and financial risk.

Long-Term Trends and Valuation Considerations

Despite recent setbacks, Akar Auto Industries Ltd has demonstrated healthy long-term growth in operating profit, expanding at an annual rate of 84.45%. The company’s return on capital employed (ROCE) stands at a robust 18.2%, suggesting efficient utilisation of capital resources. Furthermore, the enterprise value to capital employed ratio is 1.5, indicating a valuation that is attractive relative to its capital base.

The stock currently trades at a discount compared to the historical average valuations of its peers in the Auto Components & Equipments sector. However, over the past year, profits have declined by 13.3%, aligning with the negative stock price performance.

Shareholding and Market Sentiment

The majority shareholding remains with the company’s promoters, maintaining a stable ownership structure. Nevertheless, the stock’s Mojo Score has deteriorated to 31.0, with a Mojo Grade downgraded from Hold to Sell as of 29 Dec 2025. This downgrade reflects the market’s reassessment of the company’s risk and return profile amid ongoing challenges.

Summary of Key Metrics

To summarise, Akar Auto Industries Ltd’s stock has declined to Rs.86.5, its lowest level in 52 weeks, reflecting a combination of subdued quarterly results, high leverage, and underperformance relative to the broader market and sector peers. The stock’s volatility and trading below all major moving averages underscore the prevailing cautious sentiment.

While the company exhibits strong long-term operating profit growth and attractive capital efficiency metrics, recent profit declines and a challenging debt profile have weighed on investor confidence. The stock’s downgrade to a Sell grade by MarketsMOJO further highlights the tempered outlook based on current fundamentals.

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