Stock Price Movement and Market Context
On 8 Jan 2026, Ester Industries’ share price declined by 1.06% in line with the sector’s performance, closing at Rs.97.85, the lowest level in the past year. This price is substantially below its 52-week high of Rs.172.20, representing a drop of approximately 43.2%. The stock is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a persistent bearish momentum.
Meanwhile, the broader market has shown mixed signals. The Sensex opened 183.12 points lower and closed down by 295.23 points at 84,482.79, a 0.56% decline. Despite this, the Sensex remains close to its 52-week high of 86,159.02, just 1.98% away, and trades below its 50-day moving average, which itself is positioned above the 200-day moving average, indicating some underlying market resilience.
Financial Performance and Fundamental Indicators
Ester Industries’ financial metrics reveal several areas of concern that have contributed to the stock’s decline. Over the past five years, the company’s operating profits have contracted at a compound annual growth rate (CAGR) of -22.48%, highlighting a weakening earnings base. The company’s ability to service debt is limited, with a high Debt to EBITDA ratio of 6.07 times, indicating significant leverage and potential strain on cash flows.
Profitability metrics also remain subdued. The average Return on Equity (ROE) stands at 8.80%, reflecting modest returns on shareholders’ funds. The Return on Capital Employed (ROCE) is 4.6%, which, while modest, is accompanied by an attractive valuation metric with an Enterprise Value to Capital Employed ratio of 1.1, suggesting the market is pricing in the company’s challenges.
Recent Quarterly Results
The latest quarterly results for September 2025 further underscore the difficulties faced by Ester Industries. The company reported a net loss after tax (PAT) of Rs. -15.78 crores, a sharp decline of 378.8% compared to the previous four-quarter average. Operating profit before depreciation, interest, and taxes (PBDIT) was at a low Rs.15.02 crores, while the operating profit to interest coverage ratio dropped to 0.87 times, indicating limited cushion to meet interest obligations.
These figures reflect a challenging near-term environment for the company, with profitability under pressure and financial ratios signalling stress.
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Long-Term and Relative Performance
Over the last year, Ester Industries has delivered a negative return of -40.34%, significantly underperforming the Sensex, which posted an 8.10% gain over the same period. The stock has also lagged behind the broader BSE500 index across multiple timeframes, including the last three years, one year, and three months, indicating persistent underperformance relative to the market and its peers.
Despite the company’s size, domestic mutual funds hold a minimal stake of just 0.03%, which may reflect limited confidence or interest from institutional investors who typically conduct detailed research before investing.
Valuation and Profitability Metrics
While Ester Industries faces multiple headwinds, some valuation metrics suggest the stock is trading at a discount compared to its peers’ historical averages. The company’s Price/Earnings to Growth (PEG) ratio stands at 2.4, which, combined with a 104.7% increase in profits over the past year, indicates some improvement in earnings despite the stock’s price decline.
However, the relatively low ROCE and ROE figures temper this positive aspect, reflecting ongoing challenges in generating returns from capital employed and shareholders’ equity.
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Mojo Score and Market Sentiment
Ester Industries currently holds a Mojo Score of 14.0, with a Mojo Grade of Strong Sell as of 16 Jun 2025, an upgrade from the previous Sell rating. This grading reflects the company’s weak long-term fundamentals, financial stress, and recent negative earnings trends. The market capitalisation grade is 4, indicating a relatively modest size within its sector.
The stock’s recent four-day consecutive decline and trading below all major moving averages reinforce the cautious sentiment prevailing among market participants.
Summary of Key Metrics
To summarise, Ester Industries Ltd’s stock has reached a 52-week low of Rs.97.85, down from a high of Rs.172.20, amid a backdrop of subdued profitability, high leverage, and negative quarterly earnings. The company’s financial ratios and market performance highlight ongoing challenges, with limited institutional participation and a strong sell rating from MarketsMOJO.
While the stock’s valuation metrics suggest some discount relative to peers, the overall picture remains one of caution given the company’s earnings volatility and debt servicing concerns.
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