Stock Performance and Market Context
On the day the new low was recorded, Andhra Sugars Ltd outperformed its sector by 3.49%, despite the overall sector of Diversified Commodity Chemicals falling by 3.08%. The stock’s price movement showed it trading above its 5-day moving average but remained below its 20-day, 50-day, 100-day, and 200-day moving averages, indicating a short-term resilience amid longer-term downward pressure.
The broader market environment was mixed, with the Sensex opening lower at 81,947.31, down 619.06 points (-0.75%), and trading at 82,218.96 (-0.42%) during the session. The Sensex remains 4.79% below its 52-week high of 86,159.02, and is currently trading below its 50-day moving average, although the 50DMA itself is above the 200DMA, suggesting some underlying market strength despite recent volatility.
Over the past year, Andhra Sugars Ltd’s stock has declined by 18.04%, contrasting with the Sensex’s positive return of 7.11% over the same period. The stock’s 52-week high was Rs.91.30, highlighting the extent of the recent price contraction.
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Financial Metrics and Profitability Analysis
Andhra Sugars Ltd’s financial indicators reflect challenges in profitability and growth. The company’s average Return on Equity (ROE) stands at 9.18%, a figure considered modest within the commodity chemicals sector, indicating limited profitability generated per unit of shareholders’ funds. This low ROE has contributed to the stock’s downgrade from a Hold to a Sell rating as of 12 Jan 2026, with a current Mojo Score of 45.0 and a Mojo Grade of Sell.
Operating profit has declined at an annual rate of 8.87% over the last five years, signalling subdued long-term growth. This trend is consistent with the stock’s underperformance relative to benchmarks; Andhra Sugars Ltd has underperformed the BSE500 index in each of the last three annual periods, alongside generating a negative return of 18.04% in the past year.
Despite these headwinds, the company maintains a low average Debt to Equity ratio of zero, reflecting a conservative capital structure with minimal leverage. This financial prudence may provide some stability amid earnings pressures.
Recent Quarterly Highlights and Valuation
In the quarter ending September 2025, Andhra Sugars Ltd reported its highest quarterly PBDIT of Rs.55.08 crores and a PBT excluding other income of Rs.34.54 crores. The company also declared its highest dividend payout ratio (DPR) of 41.90% annually, indicating a commitment to returning value to shareholders despite earnings challenges.
The stock’s Price to Book Value ratio stands at 0.6, suggesting a fair valuation relative to its book value. The company’s ROE for the recent period was 4.7%, and profits have risen by 31.2% over the past year, contrasting with the negative stock return. The PEG ratio of 0.4 further indicates that the stock is trading at a premium compared to its peers’ average historical valuations, reflecting some market expectations of value despite recent price declines.
Shareholding and Promoter Activity
Promoter confidence appears to be strengthening, with promoters increasing their stake by 2.66% over the previous quarter to hold 49.94% of the company. This rise in promoter shareholding may be interpreted as a sign of commitment to the company’s prospects and governance.
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Summary of Key Concerns
The stock’s decline to a 52-week low is underpinned by several factors: subdued profitability as reflected in a low ROE, negative operating profit growth over five years, and consistent underperformance against benchmark indices. While the company’s low leverage and recent quarterly profit improvements provide some counterbalance, the overall financial profile has led to a downgrade in its Mojo Grade to Sell.
Market conditions have also played a role, with the broader Sensex experiencing volatility and trading below key moving averages, although Andhra Sugars Ltd’s outperformance relative to its sector on the day of the new low suggests some relative resilience.
Promoter stake increases indicate confidence from within the company, yet the stock’s valuation metrics and recent price action reflect ongoing caution among market participants.
Conclusion
Andhra Sugars Ltd’s stock reaching Rs.63.27, its lowest level in 52 weeks, highlights the challenges faced by the company in maintaining growth and profitability in a competitive commodity chemicals sector. The combination of financial metrics, market trends, and shareholding patterns provides a comprehensive picture of the current state of the stock as of 30 Jan 2026.
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