Stock Price Movement and Market Context
On 2 Feb 2026, Nandan Denim Ltd’s shares hit Rs.2.71, down 2.84% on the day, underperforming the garments and apparels sector by 2.13%. The stock is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained bearish momentum. This decline contrasts with the broader market, where the Sensex opened lower at 80,555.68 points, down 0.21%, and was trading marginally lower at 80,635.25 points (-0.11%) during the session. Notably, other indices such as the S&P BSE FMCG and NIFTY FMCG also recorded new 52-week lows, indicating sector-wide pressures.
Long-Term Performance and Relative Comparison
Over the past year, Nandan Denim Ltd’s stock has delivered a negative return of 35.22%, significantly lagging behind the Sensex’s positive 4.31% gain. The stock’s 52-week high was Rs.5.10, highlighting the steep decline it has experienced. Furthermore, the company’s performance has been below par not only in the last year but also over the last three years and the recent three-month period, underperforming the BSE500 index consistently.
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Financial Metrics and Profitability Trends
Nandan Denim Ltd’s financial indicators reveal ongoing pressures. The company’s net sales for the latest quarter stood at Rs.784.69 crores, reflecting a decline of 19.0% compared to the previous four-quarter average. Profit after tax (PAT) for the nine-month period was Rs.31.26 crores, down 27.94% year-on-year. Operating cash flow for the year was recorded at Rs.95.07 crores, marking the lowest level in recent periods.
Capital Efficiency and Debt Servicing
The company’s long-term fundamental strength remains weak, with an average Return on Capital Employed (ROCE) of 8.35%. This figure is below industry expectations and highlights limited capital efficiency. Additionally, the debt servicing capacity is constrained, as evidenced by a high Debt to EBITDA ratio of 3.02 times, indicating elevated leverage and potential challenges in meeting financial obligations.
Valuation and Market Perception
Despite the subdued performance, Nandan Denim Ltd’s valuation metrics suggest a relatively attractive entry point. The company’s ROCE of 8.6% is paired with a low Enterprise Value to Capital Employed ratio of 0.7, signalling a discount compared to peers’ historical valuations. This valuation gap reflects the market’s cautious stance given the company’s recent financial trajectory and sector dynamics.
Shareholding and Market Grade
The majority shareholding remains with the promoters, maintaining control over corporate decisions. The company’s overall market capitalisation grade is rated 4, indicating a mid-tier market cap status. Notably, the Mojo Grade for Nandan Denim Ltd was downgraded from Hold to Strong Sell on 3 Nov 2025, reflecting deteriorated fundamentals and market sentiment. The current Mojo Score stands at 17.0, underscoring the negative outlook.
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Sector and Market Environment
The garments and apparels sector continues to face headwinds, with several stocks hitting 52-week lows alongside Nandan Denim Ltd. The Sensex’s current position below its 50-day moving average, although the 50DMA remains above the 200DMA, indicates a mixed market environment with cautious investor sentiment. This broader context adds to the challenges faced by companies within the sector, including Nandan Denim Ltd.
Summary of Performance and Market Standing
In summary, Nandan Denim Ltd’s stock has experienced a marked decline over the past year, culminating in a fresh 52-week low of Rs.2.71. The company’s financial results show contraction in sales and profits, alongside subdued capital returns and elevated leverage. While valuation metrics suggest a discount relative to peers, the overall market grade and Mojo Score reflect a cautious stance. The stock’s underperformance relative to the Sensex and sector peers underscores the ongoing challenges within the garments and apparels industry.
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