Stock Price Movement and Market Context
On 9 December 2025, HP Adhesives' share price touched Rs.41.23, its lowest level in the past year and an all-time low for the company. This price point reflects a continued downward trend, with the stock recording losses over the last four consecutive trading sessions. During this period, the stock has returned approximately -4.92%, underperforming its sector by 0.84% on the day of the new low.
The stock is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained weakness in price momentum. This contrasts with the broader market, where the Sensex opened lower at 84,742.87 points, down 0.42%, but remains within 1.6% of its 52-week high of 86,159.02. The Sensex is also trading above its 50-day and 200-day moving averages, indicating a generally bullish trend for the benchmark index.
Small-cap stocks have shown relative strength, with the BSE Small Cap index gaining 0.37% on the same day, highlighting a divergence between HP Adhesives and smaller companies in the market.
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Long-Term and Recent Financial Performance
HP Adhesives has experienced a notable decline in its financial performance over the past year. The stock has generated a return of approximately -49.86% over the last 12 months, significantly lagging behind the Sensex, which recorded a positive return of 4.03% in the same period. This underperformance extends beyond the one-year horizon, with the stock also trailing the BSE500 index over the last three years, one year, and three months.
Operating profit growth over the past five years has averaged 16.27% annually, indicating modest expansion in earnings before interest and taxes. However, recent results have shown stagnation, with the company reporting flat performance in the September 2025 quarter. The profit after tax (PAT) for the first nine months of the fiscal year stood at Rs.12.21 crores, reflecting a contraction of 20.69% compared to the previous period.
Quarterly earnings per share (EPS) have also reached a low point, with the latest figure at Rs.0.38, marking the lowest level recorded in recent quarters. This decline in profitability has contributed to the subdued investor sentiment surrounding the stock.
Institutional Investor Activity
Institutional participation in HP Adhesives has diminished, with a reduction of 1.36% in their stake over the previous quarter. Currently, institutional investors collectively hold a marginal 0.02% of the company's shares. Given their typically greater analytical resources and capacity to assess company fundamentals, this decline in institutional ownership may reflect a cautious stance on the stock's prospects.
Balance Sheet and Valuation Metrics
HP Adhesives maintains a conservative capital structure, with an average debt-to-equity ratio of zero, indicating an absence of long-term debt on its balance sheet. This low leverage position reduces financial risk and interest burden, which can be favourable in volatile market conditions.
The company’s return on equity (ROE) stands at 8.7%, a moderate level that suggests some efficiency in generating profits from shareholders’ equity. Valuation metrics show the stock trading at a price-to-book value of 2.1, which is lower than the average historical valuations of its peers in the Specialty Chemicals sector. This discount in valuation reflects the market’s cautious view of the company’s near-term earnings potential.
Despite the subdued stock price, the company’s fundamentals indicate a mixed picture, with some attractive valuation aspects balanced against declining profitability and investor participation.
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Summary of Key Concerns
The recent decline to Rs.41.23 highlights several challenges faced by HP Adhesives. The stock’s sustained trading below all major moving averages signals persistent downward pressure. The company’s financial results show contraction in profits and earnings per share, while institutional investors have reduced their holdings, suggesting a cautious market stance.
Although the company’s low debt and moderate ROE provide some stability, the overall performance metrics and market valuation reflect a subdued outlook. The stock’s return over the past year has been significantly negative, and it has underperformed both its sector and broader market indices.
HP Adhesives’ current position at a 52-week low underscores the need for close monitoring of its financial developments and market conditions as the company navigates this challenging phase.
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