Quarterly Financial Overview
The latest quarter saw Eureka Forbes’ Profit After Tax (PAT) fall to ₹39.50 crores, representing a 14.7% decline compared to the average of the previous four quarters. Similarly, Profit Before Tax excluding Other Income (PBT Less OI) dropped by 14.3% to ₹48.71 crores. These contractions have contributed to the overall flat financial trend, signalling a pause in the company’s growth momentum.
Despite these setbacks, the company’s PAT over the last six months has grown by a robust 27.19%, reaching ₹102.40 crores, indicating some resilience in the half-yearly performance. However, this positive half-yearly figure contrasts with the quarterly softness, suggesting recent operational pressures.
Margin and Efficiency Metrics
Return on Capital Employed (ROCE) for the half-year period stands at 5.53%, the highest recorded in recent times for Eureka Forbes. While this indicates improved capital efficiency, it remains modest relative to industry benchmarks. The company’s Debtors Turnover Ratio has deteriorated to a low of 7.05 times, signalling potential challenges in receivables management and cash flow conversion.
Moreover, Earnings Per Share (EPS) for the quarter has declined to ₹0.52, the lowest in recent quarters, reflecting the impact of shrinking profits on shareholder returns.
Stock Market Performance and Valuation
Eureka Forbes’ stock price has mirrored the financial challenges, closing at ₹504.25 on 4 February 2026, down 7.40% from the previous close of ₹544.55. The stock’s 52-week high was ₹668.50, while the low stood at ₹451.60, indicating significant volatility over the past year.
Comparatively, the stock has underperformed the broader Sensex index across multiple time frames. Over the past one month, Eureka Forbes declined by 19.19%, whereas Sensex gained 2.27%. Year-to-date returns for the stock are down 18.31%, contrasting with a modest 1.65% gain in the Sensex. Even over a one-year horizon, the stock has fallen 10.35%, while the Sensex rose 6.66%. Longer-term returns over three years show a modest 8.23% gain for Eureka Forbes, significantly lagging the Sensex’s 37.76% appreciation.
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Mojo Score and Rating Update
MarketsMOJO’s proprietary Mojo Score for Eureka Forbes currently stands at 48.0, reflecting a cautious outlook. The company’s Mojo Grade was downgraded from Hold to Sell on 24 November 2025, signalling increased risk perceptions among analysts. The Market Cap Grade remains at 3, indicating a mid-tier valuation relative to peers in the Electronics & Appliances sector.
This downgrade aligns with the recent financial trend shift from positive to flat, underscoring concerns about the company’s ability to sustain growth and profitability in the near term.
Industry and Sector Context
Within the Electronics & Appliances sector, Eureka Forbes faces intensifying competition from both domestic and international players. The sector has witnessed mixed performance, with some companies reporting margin expansion due to cost efficiencies and product innovation, while others grapple with input cost inflation and subdued demand.
Eureka Forbes’ flat quarterly performance contrasts with some sector peers who have managed to maintain moderate revenue growth and margin stability. This divergence highlights the need for strategic initiatives to reinvigorate growth and improve operational efficiencies.
Outlook and Investor Considerations
Investors should weigh the company’s recent half-year PAT growth and improved ROCE against the quarterly declines in profitability and EPS. The deteriorating Debtors Turnover Ratio raises caution regarding working capital management, which could impact liquidity if not addressed promptly.
Given the stock’s underperformance relative to the Sensex and the downgrade to a Sell rating, investors may consider reassessing their exposure to Eureka Forbes. The company’s current price of ₹504.25 offers a discount to its 52-week high but remains vulnerable to further downside if operational challenges persist.
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Strategic Imperatives for Eureka Forbes
To reverse the current flat trend, Eureka Forbes must focus on revitalising its product portfolio and enhancing operational efficiencies. Strengthening receivables management to improve the Debtors Turnover Ratio will be critical to sustaining cash flows. Additionally, cost control measures and margin optimisation should be prioritised to counteract the recent profit contractions.
Innovation in product offerings and expansion into emerging market segments could provide new revenue streams. The company’s management will need to communicate a clear strategic roadmap to restore investor confidence and improve the Mojo Grade in forthcoming quarters.
Conclusion
Eureka Forbes Ltd’s recent quarterly results highlight a pause in its growth trajectory, with flat financial performance and margin pressures weighing on profitability. While half-yearly metrics show some resilience, the downgrade to a Sell rating and underwhelming stock returns relative to the Sensex suggest caution for investors. The company’s ability to address operational inefficiencies and reinvigorate growth will be pivotal in shaping its near-term outlook.
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