Key Events This Week
Feb 9: Stock surges 4.49% on strong opening
Feb 10: Valuation concerns emerge amid elevated P/E of 85.75
Feb 11: Q3 FY26 results reveal margin compression and profit decline
Feb 12: Negative financial trend confirmed with further quarterly deterioration
Feb 13: Stock closes week at Rs.368.95, down 6.85%
9 February 2026: Strong Start Amid Broader Market Gains
Igarashi Motors began the week on a positive note, rallying 4.49% to close at Rs.413.90, outperforming the Sensex’s 1.04% gain. The stock’s volume of 4,006 shares indicated moderate investor interest. This initial strength, however, was not sustained as the week progressed, with the stock price retreating sharply in subsequent sessions.
10 February 2026: Valuation Concerns Surface
Despite a slight dip of 0.46% to Rs.412.00, the day was notable for the release of valuation data highlighting Igarashi Motors’ stretched multiples. The company’s price-to-earnings ratio had surged to an elevated 85.75, far exceeding industry peers such as GNA Axles (P/E 17.04) and Rico Auto Industries (P/E 41.33). The price-to-book value stood at 2.82, and the EV/EBITDA multiple was 16.72, signalling a premium valuation that raised questions about price attractiveness amid modest profitability metrics.
These valuation concerns likely contributed to the stock’s inability to maintain its early week gains, as investors weighed the risk of overvaluation against the company’s financial fundamentals.
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11 February 2026: Quarterly Results Reveal Margin Pressures
The stock suffered a sharp 5.07% decline to Rs.391.10 on increased volume of 5,531 shares following the release of Q3 FY26 results. The company reported a contraction in operating profit margins to 9.44%, the lowest quarterly level recorded, alongside an 8.3% fall in net profit after tax to Rs.3.50 crores. Profit before tax excluding other income declined by 13.2% to Rs.4.14 crores compared to the previous four-quarter average.
This deterioration in profitability was a key driver behind the stock’s negative price movement, reflecting investor concerns about rising costs and pricing pressures within the auto components sector.
12 February 2026: Negative Financial Trend Confirmed
On 12 February, Igarashi Motors’ share price fell a further 1.84% to Rs.383.90 amid a broader market decline. The company’s financial trend score worsened to -7 from -5 three months prior, signalling a shift from a flat to a negative outlook. Despite an improved operating profit to interest coverage ratio of 9.76 times, the overall earnings and margin contraction weighed heavily on sentiment.
Intraday volatility was notable, with the stock trading between Rs.382.55 and Rs.417.20, but closing near the lower end of the range. The Sensex also declined by 0.56%, but the stock’s underperformance was more pronounced.
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13 February 2026: Week Closes on a Weak Note
The stock closed the week at Rs.368.95, down 3.89% on the final trading day, extending the weekly loss to 6.85%. This decline contrasted with the Sensex’s 1.40% drop, underscoring the stock’s relative weakness. Volume was notably low at 1,040 shares, suggesting subdued trading interest amid ongoing concerns about the company’s financial health and valuation.
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-09 | Rs.413.90 | +4.49% | 37,113.23 | +1.04% |
| 2026-02-10 | Rs.412.00 | -0.46% | 37,207.34 | +0.25% |
| 2026-02-11 | Rs.391.10 | -5.07% | 37,256.72 | +0.13% |
| 2026-02-12 | Rs.383.90 | -1.84% | 37,049.40 | -0.56% |
| 2026-02-13 | Rs.368.95 | -3.89% | 36,532.48 | -1.40% |
Key Takeaways
Valuation Premium Raises Concerns: Igarashi Motors’ P/E ratio of 85.75 and EV/EBITDA of 16.72 are significantly higher than industry peers, signalling a stretched valuation that may not be supported by current earnings and profitability.
Profitability Under Pressure: The Q3 FY26 results revealed margin compression with operating profit margins falling to 9.44% and net profit declining by 8.3%, reflecting cost pressures and challenging market conditions.
Negative Financial Trend: The company’s financial trend score deteriorated to -7, indicating worsening fundamentals and a shift away from stability.
Stock Underperformance: The stock’s 6.85% weekly decline far outpaced the Sensex’s 0.54% fall, highlighting investor caution and risk aversion towards the company amid these headwinds.
Debt Servicing Strength: A positive note is the improved operating profit to interest coverage ratio of 9.76 times, suggesting manageable debt levels despite earnings challenges.
Conclusion
The week’s developments for Igarashi Motors India Ltd paint a cautious picture for investors. Elevated valuation multiples combined with deteriorating profitability and a negative financial trend have weighed heavily on the stock’s performance. While the company maintains a strong interest coverage ratio, the lack of earnings growth and margin pressures present significant challenges. Relative to the broader market and sector peers, Igarashi Motors has underperformed markedly, reflecting investor concerns about its near-term prospects. Continued monitoring of upcoming quarterly results and operational improvements will be essential to assess any potential turnaround in the company’s fortunes.
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