Khadim India Ltd Stock Hits 52-Week Low Amidst Continued Downtrend

Stock Performance and Market Context

On the day the new low was recorded, Khadim India’s share price fell by 2.15% intraday, closing with a day change of -1.82%. This decline extended a losing streak spanning five consecutive trading sessions, during which the stock has depreciated by approximately 10.9%. The stock’s current price is substantially below all key 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 showed resilience on the same day. The Sensex, after an initial negative opening down by 146.36 points, rebounded to close 0.31% higher at 82,884.47. The index remains within 3.95% of its 52-week high of 86,159.02, supported by gains in mega-cap stocks. This divergence highlights Khadim India’s relative underperformance within the current market environment.

Long-Term and Recent Financial Trends

Over the past year, Khadim India’s stock has delivered a negative return of 49.23%, starkly contrasting with the Sensex’s positive 9.15% gain. The stock’s 52-week high was Rs.332, underscoring the magnitude of the decline. This performance is reflective of broader financial challenges faced by the company.

The company’s long-term financial health has been under pressure, with net sales exhibiting a compound annual growth rate (CAGR) of -6.01% over the last five years. The latest financial results, declared in December 2025, revealed a sharp 21.77% decline in net sales, contributing to a series of negative quarterly results over the last three quarters. Profit after tax (PAT) for the latest six-month period stood at Rs.3.31 crore, representing a contraction of 59.14% compared to previous periods.

Profitability and Efficiency Metrics

Khadim India’s profitability metrics remain subdued. The company’s average return on equity (ROE) is 6.90%, indicating limited profitability relative to shareholders’ funds. Return on capital employed (ROCE) is recorded at 7.5%, which, while modest, contributes to a valuation that some may consider attractive given the enterprise value to capital employed ratio of 1.3.

However, operational efficiency ratios point to challenges in managing working capital and servicing debt. The debt to EBITDA ratio stands at 4.37 times, reflecting a relatively high leverage position. The debtors turnover ratio for the half-year is at a low 2.02 times, suggesting slower collection cycles. Additionally, the operating profit to interest coverage ratio for the quarter is 1.71 times, indicating limited cushion to meet interest obligations.

Comparative Performance and Valuation

When benchmarked against its peers, Khadim India’s stock trades at a discount relative to average historical valuations within the footwear sector. Despite the subdued financial performance, this valuation gap reflects the market’s cautious stance on the company’s near-term prospects. The stock’s market capitalisation grade is rated 4, consistent with its micro-cap status and reflecting limited liquidity and scale.

Over the last three years, the stock has consistently underperformed the BSE500 index across multiple time frames, including one year and three months, reinforcing the trend of below-par returns for investors holding the stock over extended periods.

Shareholding and Sectoral Position

The majority shareholding in Khadim India remains with the promoters, maintaining a concentrated ownership structure. The company operates within the footwear industry, a sector that has witnessed varied performance across different players, with some peers demonstrating stronger growth and profitability metrics.

Despite the current valuation discount, the company’s financial indicators and recent results highlight ongoing pressures that have contributed to the stock’s decline to its lowest level in a year. The stock’s Mojo Score is 20.0, with a Mojo Grade of Strong Sell as of 11 Aug 2025, reflecting a downgrade from the previous Sell rating. This grading underscores the challenges faced by the company in reversing its recent performance trends.

Summary of Key Financial Indicators

To encapsulate, Khadim India’s key financial metrics include:

• Net sales CAGR over five years: -6.01%
• Latest net sales decline: -21.77%
• PAT growth (latest six months): -59.14%
• Debt to EBITDA ratio: 4.37 times
• Operating profit to interest coverage (quarterly): 1.71 times
• Debtors turnover ratio (half-year): 2.02 times
• Return on equity (average): 6.90%
• Return on capital employed: 7.5%
• Market cap grade: 4
• Mojo Score: 20.0 (Strong Sell)

The stock’s recent price action and financial disclosures provide a comprehensive view of the factors influencing its current valuation and market sentiment.

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