Key Events This Week
Jan 19: Rating upgraded to 'Sell' from 'Strong Sell' amid valuation and financial challenges
Jan 22: Formation of Golden Cross, signalling potential bullish breakout
Jan 23: Week closes at Rs.154.00 (-1.25%)
Monday, 19 January 2026: Rating Upgrade Amid Ongoing Challenges
On Monday, Nagpur Power & Industries Ltd’s rating was upgraded by MarketsMOJO from 'Strong Sell' to 'Sell', reflecting a slight improvement in valuation metrics despite continued financial headwinds. The stock closed at Rs.165.35, down 1.99% from the previous close of Rs.168.70. This adjustment was driven by a shift in valuation grading from 'very expensive' to 'expensive', with key ratios such as a negative Price-to-Earnings (PE) of -169.17 and a Price-to-Book (P/B) ratio of 2.55 underscoring the company’s challenging fundamentals.
Financially, the company reported a steep decline in profitability, with a Q2 FY25-26 PAT of Rs.-0.99 crore and a negative PBDIT of Rs.-0.14 crore. The operating profit growth averaged only 16.76% annually over five years, insufficient to offset losses. Return on Capital Employed (ROCE) and Return on Equity (ROE) remained low at 0.32% and 3.24% respectively, highlighting weak capital efficiency. Despite these concerns, the upgrade signals a cautious improvement in outlook, though risks remain significant.
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Tuesday to Thursday, 20-22 January 2026: Continued Price Decline and Technical Breakout
The stock continued its downward trajectory on Tuesday and Wednesday, closing at Rs.162.15 (-1.94%) and Rs.159.10 (-1.88%) respectively, amid broader market weakness as the Sensex fell 1.82% and 0.47% on those days. On Thursday, however, despite a 1.98% decline to Rs.155.95, Nagpur Power & Industries Ltd formed a significant technical pattern known as the Golden Cross, where the 50-day moving average crossed above the 200-day moving average. This event is widely regarded as a bullish signal, suggesting a potential shift in long-term momentum and a possible trend reversal.
The Golden Cross was accompanied by mixed technical indicators: while daily moving averages and MACD pointed to bullish momentum, weekly RSI remained bearish and monthly RSI neutral, indicating some caution. The stock’s one-month return of 87.48% and three-month gain of 51.92% contrast sharply with the Sensex’s negative returns over the same periods, highlighting the stock’s resilience despite recent price declines.
Friday, 23 January 2026: Week Closes Lower Amid Market Weakness
On Friday, the stock closed at Rs.154.00, down 1.25% from Thursday’s close, as the Sensex declined 1.33%. This marked the end of a difficult week with an overall loss of 8.71%. The stock’s underperformance relative to the Sensex’s 3.31% decline reflects ongoing investor caution amid the company’s fundamental challenges. Nonetheless, the technical formation of the Golden Cross earlier in the week offers a potential foundation for future recovery if supported by improved fundamentals.
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Daily Price Performance vs Sensex
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-01-19 | Rs.165.35 | -1.99% | 36,650.97 | -0.49% |
| 2026-01-20 | Rs.162.15 | -1.94% | 35,984.65 | -1.82% |
| 2026-01-21 | Rs.159.10 | -1.88% | 35,815.26 | -0.47% |
| 2026-01-22 | Rs.155.95 | -1.98% | 36,088.66 | +0.76% |
| 2026-01-23 | Rs.154.00 | -1.25% | 35,609.90 | -1.33% |
Key Takeaways
Positive Signals: The formation of the Golden Cross on 22 January is a significant technical development suggesting a potential bullish breakout and a shift in long-term momentum. The stock’s strong one-month and three-month returns relative to the Sensex indicate resilience and underlying strength despite recent price declines. The upgrade to a 'Sell' rating from 'Strong Sell' reflects a cautious improvement in valuation metrics.
Cautionary Notes: Nagpur Power & Industries Ltd continues to face substantial financial challenges, including negative profitability, weak returns on capital, and poor debt servicing capacity. The stock’s weekly price trend was negative throughout, with consistent daily declines exceeding Sensex losses on most days. The negative PE ratio and elevated valuation multiples highlight ongoing risks. Mixed technical indicators such as bearish weekly RSI suggest that the bullish signal should be interpreted with caution.
Conclusion
This week’s developments for Nagpur Power & Industries Ltd present a complex picture. While the stock’s price declined sharply by 8.71%, underperforming the Sensex’s 3.31% fall, the upgrade in rating and the formation of a Golden Cross provide a foundation for cautious optimism. The technical breakout signals potential for a trend reversal, but fundamental weaknesses remain a significant drag on the stock’s prospects. Investors should monitor upcoming financial results and price action closely to assess whether the technical momentum can translate into sustained recovery amid the challenging operating environment.
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