Stock Price Movement and Market Context
On 23 Feb 2026, Nikhil Adhesives Ltd’s stock recorded an intraday low of Rs.59.51, representing a 3.97% drop from the previous close and underperforming its sector by 4.18%. The stock’s day change was a negative 3.10%, and it currently trades below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages. This technical positioning underscores the prevailing bearish sentiment around the stock.
In contrast, the broader market displayed resilience, with the Sensex rising by 0.38% to close at 83,125.93 points, just 3.65% shy of its 52-week high of 86,159.02. Mega-cap stocks led the rally, while the Sensex itself remains below its 50-day moving average, though the 50DMA is positioned above the 200DMA, signalling a mixed but cautiously optimistic market environment.
Long-Term Performance and Financial Metrics
Over the past year, Nikhil Adhesives Ltd has delivered a total return of -41.53%, a stark contrast to the Sensex’s positive 10.40% return over the same period. The stock’s 52-week high was Rs.129, highlighting the extent of the decline. This underperformance extends beyond the last year, with the company lagging behind the BSE500 index in each of the past three annual periods.
Financially, the company has exhibited modest growth with net sales increasing at an annual rate of 6.10% and operating profit growing at 7.77% over the last five years. However, recent quarterly and half-yearly results have been subdued. The December 2025 quarter saw the lowest quarterly PBDIT at Rs.7.68 crores, while cash and cash equivalents at half-year stood at a low Rs.2.13 crores. Additionally, the debtors turnover ratio was at its lowest at 4.70 times, indicating potential challenges in receivables management.
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Valuation and Efficiency Indicators
Despite the stock’s price decline, certain financial ratios reflect operational strengths. The company maintains a high return on capital employed (ROCE) of 26.93%, indicating efficient use of capital. Its debt servicing capability is robust, with a low debt to EBITDA ratio of 1.17 times, suggesting manageable leverage levels.
Valuation metrics also point to an attractive entry point relative to peers. The enterprise value to capital employed ratio stands at 1.8, and the company’s ROCE of 15.1 supports a valuation discount compared to historical averages within the Specialty Chemicals sector. Nonetheless, profitability has contracted, with profits falling by 8% over the past year, reflecting pressures on earnings despite operational efficiencies.
Shareholding and Market Position
Promoters remain the majority shareholders of Nikhil Adhesives Ltd, maintaining significant control over the company’s strategic direction. The Specialty Chemicals sector, in which the company operates, continues to be competitive, with peers exhibiting varied performance trends.
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Summary of Ratings and Market Sentiment
Reflecting the company’s recent performance and outlook, the Mojo Score for Nikhil Adhesives Ltd stands at 47.0, with a Mojo Grade of Sell as of 24 Nov 2025. This represents a downgrade from the previous Hold rating, signalling a cautious stance based on the company’s financial trends and market behaviour.
The market capitalisation grade is rated at 4, indicating a relatively modest market cap within its sector. The stock’s consistent underperformance against benchmarks and peers over multiple years has contributed to this rating adjustment.
Conclusion
Nikhil Adhesives Ltd’s stock reaching a 52-week low of Rs.59.51 highlights ongoing challenges in maintaining market confidence amid subdued financial results and relative underperformance. While the company demonstrates strengths in capital efficiency and debt management, these have not translated into positive share price momentum. The stock’s valuation metrics suggest it is trading at a discount compared to peers, yet recent profit declines and weak turnover ratios underscore areas of concern. The broader market’s positive trajectory contrasts with the stock’s downward trend, emphasising the divergence in performance within the Specialty Chemicals sector.
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