Extended Price Decline and Market Context
The stock’s recent performance contrasts sharply with broader market trends. While the Sensex opened the day 122.62 points higher, it later retreated by 288.25 points to trade at 85,401.85, down 0.19%. Despite this dip, the Sensex remains close to its 52-week high of 86,159.02, just 0.89% away, and continues to trade above its 50-day moving average, which itself is positioned above the 200-day moving average, signalling a generally bullish market environment.
In comparison, Cupid Breweries & Distilleries is trading below all key moving averages — the 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring the stock’s sustained weakness relative to the broader market and its sector peers.
Performance Over the Past Year
Over the last twelve months, Cupid Breweries & Distilleries has recorded a total return of -24.09%, underperforming the Sensex, which has posted a positive return of 8.76% during the same period. The stock’s 52-week high was Rs.159.65, indicating a substantial decline from its peak to the current low of Rs.36.1.
This underperformance extends beyond the one-year horizon, with the stock lagging behind the BSE500 index over the last three years, one year, and three months, reflecting challenges in maintaining competitive growth and profitability within the beverages sector.
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Financial and Fundamental Overview
Cupid Breweries & Distilleries operates within the beverages industry, a sector that has seen varied performance across companies. The company’s long-term fundamentals indicate areas of concern. The book value is negative, which points to weak long-term financial strength. Over the past five years, net sales have shown an annual growth rate of 58.00%, yet operating profit has remained flat, showing no growth during this period.
Debt levels also present a notable factor. The company’s average debt-to-equity ratio stands at zero, indicating a high debt burden relative to equity, which can constrain financial flexibility and increase risk exposure.
Profitability and Valuation Considerations
Profitability metrics have shown a decline, with profits falling by 41% over the past year. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) are negative, which adds to the risk profile of the stock. This negative EBITDA suggests that the company is currently not generating sufficient earnings from its core operations to cover its operating expenses.
Valuation levels also reflect this risk, as the stock is trading at levels considered risky compared to its historical averages. This valuation context, combined with the negative earnings trend, has contributed to the stock’s downward price movement.
Shareholding and Market Capitalisation
The majority shareholding of Cupid Breweries & Distilleries rests with promoters, which can influence corporate governance and strategic decisions. The company’s market capitalisation grade is relatively low, indicating a smaller market value compared to larger peers in the beverages sector.
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Sector and Market Position
Within the beverages sector, Cupid Breweries & Distilleries has faced challenges in maintaining growth and profitability compared to its peers. The sector itself has seen mixed results, with some companies demonstrating stronger fundamentals and more consistent earnings growth.
Despite the broader market’s positive momentum, particularly among small-cap stocks which gained 0.16% today, Cupid Breweries & Distilleries has not mirrored this trend, instead continuing its downward path.
Summary of Key Price and Performance Metrics
The stock’s new 52-week low of Rs.36.1 represents a significant decline from its 52-week high of Rs.159.65. The consecutive 18-day fall has resulted in a cumulative return loss of 58.18%. The stock’s position below all major moving averages highlights the sustained weakness in price action.
In contrast, the Sensex remains near its 52-week high and trades above key moving averages, reflecting a more positive overall market environment.
Conclusion
Cupid Breweries & Distilleries’ recent price movement to a 52-week low underscores the challenges the company faces in terms of financial health, profitability, and market valuation. The stock’s performance over the past year and longer term has lagged behind broader market indices and sector peers. While the beverages sector continues to evolve, the company’s current financial metrics and market positioning indicate a cautious outlook based on available data.
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