Stock Price Movement and Market Context
The stock opened with a gap down of -7.23% and continued to slide throughout the trading session, touching an intraday low of Rs.762.6. This represents a day’s decline of -4.51%, underperforming its sector by -3.1%. Over the past three trading days, Brady & Morris has recorded a cumulative loss of -9.62%, reflecting sustained selling pressure. The stock currently trades below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a persistent downtrend.
In comparison, the broader market has also faced headwinds. The Sensex opened 385.82 points lower and closed down by 288.88 points at 81,505.77, a decline of -0.82%. The index has been on a three-week losing streak, shedding -4.96% in that period. While the Sensex trades below its 50-day moving average, the 50DMA remains above the 200DMA, indicating some underlying resilience in the broader market despite recent weakness.
Financial Performance and Recent Results
Brady & Morris Engineering Company Ltd’s financial results have contributed to the stock’s subdued performance. The company reported a sharp decline in net sales, which fell by -34.53% in the fiscal year ending September 2025. Quarterly net sales stood at Rs.12.99 crores, down -42.0% compared to the previous four-quarter average. Profit before tax excluding other income (PBT less OI) plummeted by -99.5% to a marginal Rs.0.01 crore in the latest quarter, while net profit after tax (PAT) declined by -71.6% to Rs.0.48 crore.
This marks the third consecutive quarter of negative results, underscoring the challenges faced by the company in maintaining revenue and profitability levels. Over the last five years, operating profit has grown at an annual rate of 18.11%, which is considered modest within the industry context.
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Relative Performance and Valuation Metrics
Over the past year, Brady & Morris Engineering Company Ltd has underperformed significantly, delivering a total return of -40.93%, while the Sensex gained 7.39% and the BSE500 index returned 5.63%. This divergence highlights the stock’s relative weakness within the broader market and its sector.
Despite the recent price decline, the company maintains a high return on equity (ROE) of 32.29%, indicating efficient utilisation of shareholder capital. The debt servicing capability remains strong, with a low Debt to EBITDA ratio of 1.11 times, reflecting manageable leverage levels. The stock’s price-to-book value ratio stands at 3.7, which is attractive relative to its peers’ historical valuations, suggesting the market is pricing in the company’s current challenges.
Shareholding and Market Capitalisation
The majority shareholding is held by promoters, providing a stable ownership structure. The company’s market capitalisation grade is rated 4, reflecting its size and liquidity profile within the automobile sector. The Mojo Score of 33.0 and a recent downgrade from Hold to Sell on 26 Aug 2025 further illustrate the cautious stance adopted by rating agencies based on the company’s recent performance trends.
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Summary of Key Concerns
The stock’s decline to Rs.762.6 represents a significant correction from its 52-week high of Rs.2018, reflecting a loss of over 62% from that peak. The recent quarterly results have shown marked declines in sales and profitability, with net sales falling by over 40% compared to the previous four-quarter average and profits contracting sharply. This has contributed to the stock’s downgrade and the negative sentiment surrounding the company.
Trading below all major moving averages and underperforming both its sector and the broader market, Brady & Morris Engineering Company Ltd faces a challenging environment. However, its strong ROE and low leverage indicate underlying financial discipline despite the current earnings pressure.
Market and Sector Dynamics
The automobile sector, in which Brady & Morris operates, has experienced volatility in recent months, influenced by macroeconomic factors and shifting demand patterns. The company’s performance relative to its sector peers has been subdued, as reflected in its Mojo Grade downgrade to Sell from Hold. The sector’s overall performance has also been impacted by the broader market’s downward trend, with the Sensex declining nearly 5% over the last three weeks.
Conclusion
Brady & Morris Engineering Company Ltd’s stock reaching a 52-week low at Rs.762.6 highlights the pressures faced by the company amid declining sales and profits. While the stock’s valuation metrics and financial ratios suggest some resilience, the recent performance trends and market conditions have weighed heavily on the share price. The stock’s underperformance relative to the Sensex and its sector peers underscores the challenges it currently faces within the automobile industry landscape.
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