Stock Price Movement and Market Context
The stock has been on a declining streak for the past two days, registering a cumulative fall of 1.83% during this period. Today’s drop of 0.78% aligns with sectoral trends, as the FMCG sector has also experienced modest downward pressure. Jay Shree Tea is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a persistent bearish momentum.
In comparison, the Sensex opened flat but soon turned negative, closing down by 430.24 points or 0.61% at 83,064.25. Despite this decline, the Sensex remains within 3.73% of its 52-week high of 86,159.02. However, the benchmark index has been on a three-week losing streak, shedding 3.15% over this period. Notably, the Sensex is trading below its 50-day moving average, although the 50DMA remains above the 200DMA, indicating mixed signals for the broader market.
Long-Term Performance and Relative Underperformance
Over the last year, Jay Shree Tea & Industries Ltd has delivered a negative return of 25.23%, a stark contrast to the Sensex’s positive 8.32% gain over the same timeframe. The stock’s 52-week high was Rs.122.4, highlighting the extent of the recent decline. This underperformance is consistent with the company’s track record over the past three years, during which it has lagged behind the BSE500 index in each annual period.
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Financial Metrics and Fundamental Assessment
Jay Shree Tea & Industries Ltd’s financial indicators reveal ongoing challenges. The company’s long-term fundamental strength is weak, with an average Return on Capital Employed (ROCE) of 0%. Operating profit has declined sharply, registering an annualised contraction of 204.38% over the past five years. This negative growth trend is further underscored by the company’s high Debt to EBITDA ratio of -1.00 times, indicating limited capacity to service its debt obligations effectively.
Recent quarterly and annual results have also reflected subdued performance. Operating cash flow for the year ended September 2025 was negative at Rs.42.51 crores, marking the lowest level in recent periods. Profit After Tax (PAT) for the latest six months stood at Rs.10.60 crores, having contracted by 62.20%. Similarly, Profit Before Tax excluding other income (PBT less OI) for the quarter was Rs.19.19 crores, down 53.86% year-on-year.
Valuation and Risk Considerations
The stock’s valuation metrics suggest elevated risk relative to its historical averages. Despite the negative return of 25.23% over the past year, the company’s profits have increased by 305.6%, resulting in a PEG ratio of zero. This disparity points to a disconnect between earnings growth and market valuation. The stock’s current Mojo Score is 3.0, with a Mojo Grade of Strong Sell, upgraded from Sell on 3 November 2025. The Market Cap Grade stands at 4, reflecting the company’s micro-cap status within the FMCG sector.
Promoters remain the majority shareholders, maintaining significant control over the company’s strategic direction. However, the stock’s consistent underperformance against benchmarks such as the BSE500 over the last three years highlights ongoing challenges in delivering shareholder value.
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Summary of Current Situation
Jay Shree Tea & Industries Ltd’s stock reaching a new 52-week low of Rs.80.2 is a reflection of multiple factors, including weak long-term profitability, subdued cash flows, and a challenging debt profile. The stock’s performance has lagged significantly behind the broader market and sector indices, with negative returns over the past year and consistent underperformance over several years. Trading below all major moving averages, the stock remains under pressure amid a broader market environment that has also seen recent declines.
While the Sensex and FMCG sector have experienced some volatility, Jay Shree Tea’s relative weakness is pronounced, underscoring the company’s current financial and valuation challenges. The recent downgrade to a Strong Sell rating by MarketsMOJO further emphasises the cautious stance on the stock based on its fundamental and technical indicators.
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