HP Adhesives Ltd Falls to 52-Week Low Amid Continued Downtrend

Recent Price Movement and Market Context

On the day the new low was recorded, HP Adhesives Ltd’s share price fell by 2.43%, underperforming the Specialty Chemicals sector by 1.89%. This decline extends a three-day losing streak during which the stock has shed 8.03% of its value. The current price is substantially below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained bearish momentum.

In contrast, the broader market benchmark, the Sensex, experienced a negative session, closing down 343.58 points or 0.46% at 82,863.80. Despite this, the Sensex remains within 3.98% of its 52-week high of 86,159.02. However, the index itself has been on a three-week consecutive decline, losing 3.38% over that period.

Long-Term Performance and Relative Comparison

HP Adhesives Ltd’s one-year performance starkly contrasts with the Sensex’s 7.53% gain, as the stock has depreciated by 48.64% over the same timeframe. This underperformance extends beyond the last year, with the stock lagging the BSE500 index across one-year, three-month, and three-year horizons. The 52-week high for the stock was Rs.74.95, underscoring the magnitude of the recent decline.

Financial Metrics and Profitability Trends

HP Adhesives Ltd’s financial results have reflected subdued growth. The company’s operating profit has expanded at an annualised rate of 16.27% over the past five years, a pace considered modest within the specialty chemicals sector. The latest nine-month period ending September 2025 saw a decline in profit after tax (PAT) to Rs.12.21 crores, representing a contraction of 20.69% compared to prior periods.

Quarterly earnings per share (EPS) have also reached a low point, with the most recent quarter reporting an EPS of Rs.0.38, the lowest recorded in recent times. This decline in profitability has contributed to the stock’s negative returns and diminished investor confidence.

Valuation and Capital Structure

Despite the recent price weakness, HP Adhesives Ltd maintains a relatively attractive valuation profile. The company’s return on equity (ROE) stands at 8.7%, and it trades at a price-to-book value ratio of 1.9, which is below the average historical valuations of its peers in the specialty chemicals industry. This discount reflects the market’s cautious stance given the company’s recent performance.

Capital structure remains conservative, with an average debt-to-equity ratio of zero, indicating the company operates without significant leverage. Majority ownership rests with promoters, providing a stable shareholder base.

Sector and Market Positioning

HP Adhesives Ltd operates within the specialty chemicals sector, a segment characterised by cyclical demand and sensitivity to raw material costs and global economic conditions. The stock’s recent underperformance relative to the sector highlights challenges in maintaining growth momentum amid competitive pressures and market fluctuations.

Summary of Key Concerns

The stock’s decline to Rs.36.76 marks a new low point, reflecting a combination of factors including subdued profit growth, declining earnings per share, and sustained underperformance relative to market benchmarks. The three-day consecutive fall and trading below all major moving averages indicate persistent downward pressure.

While the company’s low leverage and reasonable valuation metrics provide some stability, the recent financial results and price action suggest ongoing challenges in regaining upward momentum within a competitive sector environment.

Market Sentiment and Broader Implications

HP Adhesives Ltd’s current Mojo Score stands at 40.0, with a Mojo Grade of Sell, downgraded from Hold on 12 Nov 2025. This reflects a cautious market stance based on the company’s recent financial and price performance. The market capitalisation grade is rated at 4, indicating a smaller market cap relative to larger peers.

The stock’s performance contrasts with the broader market’s relative resilience, as the Sensex remains close to its 52-week high despite recent volatility. This divergence underscores sector-specific and company-specific factors influencing HP Adhesives Ltd’s share price trajectory.

Conclusion

HP Adhesives Ltd’s fall to a 52-week low of Rs.36.76 on 20 Jan 2026 highlights a period of sustained price weakness amid modest profit growth and earnings contraction. The stock’s underperformance relative to sector peers and market indices, combined with its downgrade to a Sell grade, reflects the challenges faced by the company in the current market environment. Trading below all key moving averages and experiencing a three-day losing streak, the stock remains under pressure as it navigates a complex industry landscape.

Upgrade at special rates, valid only for the next few days. Claim Your Special Rate →