Recent Price Movement and Market Context
On 27 Jan 2026, Nandan Denim’s share price slipped to Rs.2.76, underperforming the Garments & Apparels sector by 1.38% and registering a day change of -0.71%. This decline extends a two-day losing streak, during which the stock has fallen by approximately 1.4%. The stock is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained downward momentum.
The broader market environment has also been subdued. The Sensex opened 100.91 points lower and is trading at 81,280.40, down 0.32%. Notably, the Sensex has experienced a three-week consecutive decline, losing 2.75% over this period. Several indices, including NIFTY MEDIA and NIFTY REALTY, also hit new 52-week lows today, indicating sectoral and market-wide pressures.
Long-Term Performance and Relative Comparison
Over the past year, Nandan Denim has delivered a negative return of 33.41%, a stark contrast to the Sensex’s positive 7.81% gain during the same period. This underperformance extends beyond the last 12 months, with the stock lagging the BSE500 index over the last three years, one year, and three months. The 52-week high for the stock was Rs.5.10, highlighting the significant erosion in value over the past year.
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Financial Metrics and Fundamental Assessment
Nandan Denim’s fundamental profile continues to reflect challenges. The company’s long-term Return on Capital Employed (ROCE) stands at a modest 8.35%, indicating limited efficiency in generating returns from its capital base. This figure is below the threshold typically associated with robust capital utilisation in the garments and apparels industry.
Debt servicing capacity remains constrained, with a Debt to EBITDA ratio of 3.02 times, signalling elevated leverage relative to earnings before interest, taxes, depreciation, and amortisation. This level of indebtedness may restrict financial flexibility and increase vulnerability to interest rate fluctuations.
Operating cash flow for the fiscal year is reported at Rs.95.07 crores, the lowest in recent periods, underscoring pressures on cash generation. Profit after tax (PAT) for the nine-month period stands at Rs.31.26 crores, reflecting a decline of 27.94% compared to prior periods. Net sales for the latest quarter were Rs.784.69 crores, down 19.0% relative to the average of the preceding four quarters, indicating weakening top-line momentum.
Valuation and Market Perception
Despite the subdued financial performance, Nandan Denim’s valuation metrics suggest a degree of market discounting. The company’s ROCE of 8.6 corresponds with a very attractive Enterprise Value to Capital Employed ratio of 0.7, positioning the stock below the average historical valuations of its peers. This valuation gap reflects market concerns but also indicates the stock is trading at a relative discount within its sector.
Profitability trends over the past year have been negative, with profits declining by 26.3%, reinforcing the subdued earnings environment. The majority shareholding remains with promoters, maintaining concentrated ownership control.
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Technical Indicators and Market Sentiment
The stock’s position below all major moving averages signals a bearish technical stance. The 5-day, 20-day, 50-day, 100-day, and 200-day moving averages all lie above the current price, indicating persistent selling pressure and a lack of upward momentum in recent trading sessions.
Sectoral performance has also been mixed, with the Garments & Apparels sector facing headwinds amid broader market volatility. The Sensex’s recent three-week decline of 2.75% and the 52-week lows hit by related indices such as NIFTY MEDIA and NIFTY REALTY contribute to a cautious market environment.
Summary of Key Performance Indicators
To summarise, Nandan Denim Ltd’s key metrics as of 27 Jan 2026 are:
- New 52-week low price: Rs.2.76
- One-year stock return: -33.41%
- Sensex one-year return: +7.81%
- Debt to EBITDA ratio: 3.02 times
- ROCE: 8.35%
- Operating cash flow (annual): Rs.95.07 crores
- PAT (9 months): Rs.31.26 crores, down 27.94%
- Net sales (quarterly): Rs.784.69 crores, down 19.0%
- Mojo Score: 17.0
- Mojo Grade: Strong Sell (downgraded from Hold on 03 Nov 2025)
- Market Cap Grade: 4
The downgrade to a Strong Sell grade by MarketsMOJO on 03 Nov 2025 reflects the deteriorated fundamental and technical outlook for the stock. The Mojo Score of 17.0 further underscores the cautious stance adopted by the rating agency.
Conclusion
Nandan Denim Ltd’s fall to a new 52-week low of Rs.2.76 encapsulates a period of sustained underperformance relative to the broader market and sector peers. The combination of declining sales, reduced profitability, elevated leverage, and weak cash flow generation has weighed on investor sentiment and share price. While the stock currently trades at a valuation discount, the prevailing financial and technical indicators highlight ongoing challenges for the company within the garments and apparels industry.
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