In the latest quarter, Bannari Amman Spinning Mills reported its operating profit to interest ratio at 2.30 times, marking the highest level recorded in recent periods. The half-year return on capital employed (ROCE) stood at 7.14%, also the highest observed, while the debt-equity ratio was at a low of 0.96 times, indicating a relatively conservative capital structure. The company’s profit after tax (PAT) for the quarter reached Rs 5.25 crores, with earnings per share (EPS) at Rs 0.69, both figures representing peak quarterly values in the recent financial timeline.
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Despite these positive financial markers, Bannari Amman Spinning Mills’ Mojo Score has adjusted to 37.0 with a corresponding grade change from Strong Sell to Sell as of 17 February 2025. This adjustment reflects a revision in its evaluation parameters rather than the emergence of any key negative triggers. The company’s market capitalisation grade remains at 4, and the stock price has shown minimal day change, closing at Rs 28.98 on the latest trading day, with a 52-week range between Rs 25.00 and Rs 59.75.
Examining the stock’s return profile against the Sensex benchmark reveals a contrasting performance. Over the past week and month, Bannari Amman Spinning Mills outperformed the Sensex with returns of 11.12% and 11.81% respectively, compared to Sensex returns of 0.96% and 0.86%. However, the year-to-date and longer-term returns show a different picture, with the stock posting negative returns of approximately -45.8% over one year and -74.98% over ten years, while the Sensex recorded positive returns of 9.48% and 232.28% over the same periods. This divergence highlights the stock’s volatility and the challenges faced in sustaining long-term growth relative to the broader market.
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From a sector perspective, Bannari Amman Spinning Mills operates within the Garments & Apparels industry, which has faced varied headwinds and opportunities in recent quarters. The company’s financial trend adjustment signals a recalibration in its operational and financial metrics, which investors may consider alongside broader sectoral dynamics and market conditions. The absence of key negative triggers in the latest quarter suggests stability, yet the downward revision in the financial trend score indicates a more cautious outlook on near-term performance.
Investors analysing Bannari Amman Spinning Mills should weigh the recent quarterly highs in profitability ratios and earnings against the longer-term return challenges and the current market valuation context. The stock’s limited price movement on the day and its position relative to its 52-week high and low provide additional context for evaluating entry or exit points in a volatile market environment.
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