Recent Price Movement and Market Context
The stock recorded an intraday low of Rs.151.65, reflecting a 2.03% drop on the day and underperforming its sector by 1.53%. This marks the fifth consecutive day of losses, during which the share price has declined by 9.12%. Currently, Greaves Cotton is trading below all major moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling persistent bearish momentum.
In contrast, the broader market has shown relative resilience. The Sensex opened higher at 82,530.12, gaining 304.20 points (0.37%) before settling near 82,231.04, just 0.01% up. The index remains 4.78% shy of its 52-week high of 86,159.02. Mega-cap stocks are leading the market gains, while the Sensex trades below its 50-day moving average but with the 50DMA still above the 200DMA, indicating a mixed technical backdrop.
Long-Term Performance and Relative Weakness
Over the past year, Greaves Cotton has delivered a negative return of 40.67%, a stark contrast to the Sensex’s positive 10.23% gain over the same period. The stock’s 52-week high was Rs.265.85, highlighting the extent of the recent decline. This underperformance extends beyond the last year, with the stock lagging the BSE500 index across one-year, three-year, and three-month timeframes.
Such sustained underperformance has been reflected in the company’s MarketsMOJO Mojo Score, which currently stands at 40.0, categorising it as a Sell. This represents a downgrade from its previous Hold rating, effective from 3 November 2025. The Market Cap Grade remains low at 3, underscoring concerns about the company’s market valuation and investor sentiment.
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Shareholding and Valuation Insights
Despite Greaves Cotton’s sizeable market presence, domestic mutual funds hold a modest stake of only 1.98%. Given that these funds typically conduct thorough on-the-ground research, their limited exposure may indicate reservations about the company’s current valuation or business prospects.
The stock trades at a premium relative to its peers’ historical valuations, with a Price to Book Value ratio of 2.6. Its Return on Equity (ROE) stands at 7.5%, suggesting a fair valuation level. However, the Price/Earnings to Growth (PEG) ratio is notably low at 0.2, reflecting the disparity between the stock price decline and the company’s earnings growth.
Financial Performance Highlights
Greaves Cotton has demonstrated healthy long-term growth in operating profit, which has increased at an annual rate of 156.74%. The company has reported positive results for the last four consecutive quarters, with the most recent quarter showing net sales of Rs.875.47 crores and PBDIT of Rs.62.12 crores, both at their highest levels.
The half-yearly Return on Capital Employed (ROCE) peaked at 9.11%, reflecting efficient capital utilisation. Additionally, the company maintains a low average Debt to Equity ratio of zero, indicating a debt-free balance sheet that reduces financial risk.
Sector and Peer Comparison
Operating within the Compressors, Pumps & Diesel Engines sector, Greaves Cotton’s recent underperformance contrasts with broader sector trends. While the sector has seen mixed results, the company’s stock has lagged behind peers in both short and long-term returns. This divergence is further emphasised by the stock’s current Mojo Grade of Sell, compared to more favourable ratings for some competitors.
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Summary of Key Metrics
To summarise, Greaves Cotton’s stock has declined to Rs.151.65, its lowest level in 52 weeks, reflecting a 40.67% loss over the past year. This contrasts with the Sensex’s 10.23% gain during the same period. The company’s financials show robust operating profit growth and consistent quarterly earnings improvements, alongside a debt-free capital structure. However, the stock’s valuation premium and limited institutional holding highlight ongoing market caution.
While the broader market environment remains relatively stable, Greaves Cotton’s share price continues to face downward pressure, trading below all major moving averages and underperforming its sector peers. The downgrade to a Sell rating by MarketsMOJO further underscores the challenges the stock currently faces in regaining investor confidence.
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