Stock Performance and Market Context
On 1 Dec 2025, Mehai Technology's share price touched Rs.1.8, its lowest level in the past year. This decline contrasts sharply with broader market movements, as the Sensex opened higher at 86,065.92 points, gaining 0.42% at the start of the day and trading near its 52-week high of 86,055.86. The Sensex has recorded a three-week consecutive rise, accumulating a gain of 1.56%, supported by bullish moving averages where the 50-day moving average remains above the 200-day moving average. Additionally, the BSE Small Cap index, which includes Mehai Technology, advanced by 0.41% today, indicating a generally positive environment for smaller companies.
Despite this favourable market backdrop, Mehai Technology underperformed its sector by 4.9% today, continuing a trend of relative weakness. The stock is trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling persistent downward momentum.
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Long-Term and Recent Returns
Over the past year, Mehai Technology's stock has recorded a return of -83.12%, a stark contrast to the Sensex's 7.60% gain during the same period. The stock's 52-week high was Rs.19.26, highlighting the extent of the decline. This underperformance extends beyond the last year, with the company lagging behind the BSE500 index over the last three years, one year, and three months.
Financial Metrics and Profitability
Mehai Technology's financial indicators reveal challenges in profitability and capital efficiency. The company has generated an average Return on Capital Employed (ROCE) of 5.54%, indicating modest returns relative to the total capital invested. Similarly, the average Return on Equity (ROE) stands at 3.86%, reflecting limited profitability on shareholders' funds.
The company's ability to service debt is constrained, with a Debt to EBITDA ratio of 3.59 times. This level suggests a relatively high debt burden compared to earnings before interest, taxes, depreciation, and amortisation, which may impact financial flexibility.
Sales and Profit Growth Trends
Despite the stock's price decline, Mehai Technology has demonstrated notable growth in sales and profits over recent periods. Net sales have expanded at an annual rate of 193.15%, while operating profit has grown at 159.48%. The company has reported positive results for five consecutive quarters, with the latest six-month Profit After Tax (PAT) at Rs.2.68 crores, reflecting a growth rate of 182.11%.
Quarterly net sales reached Rs.22.00 crores, growing at 116.32%, and Profit Before Tax excluding other income (PBT less OI) stood at Rs.2.15 crores, increasing by 91.96%. These figures indicate operational improvements amid the broader stock price weakness.
Valuation and Market Position
Mehai Technology's valuation metrics suggest a discount relative to its peers. The company has a Return on Capital Employed of 8.9 in the latest assessment, coupled with an Enterprise Value to Capital Employed ratio of 1, which is considered attractive. The stock's Price/Earnings to Growth (PEG) ratio is 0.1, reflecting the relationship between its price, earnings, and growth rate.
Promoters remain the majority shareholders, maintaining significant control over the company's direction.
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Summary of Current Situation
Mehai Technology's stock has experienced a prolonged decline, culminating in a 52-week low of Rs.1.8. This movement contrasts with the broader market's positive trajectory, including the Sensex's proximity to its 52-week high and gains in the small-cap segment. The stock's performance reflects a combination of subdued profitability metrics, elevated debt levels, and sustained underperformance relative to market benchmarks.
Nevertheless, the company has reported consistent sales and profit growth over recent quarters, alongside valuation metrics that suggest the stock is trading at a discount compared to peers. These factors provide a nuanced picture of Mehai Technology's current standing within the Trading & Distributors sector.
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