Stock Price Movement and Market Context
On 30 Dec 2025, Nikhil Adhesives Ltd’s share price touched an intraday low of Rs.77.78, representing a 2.51% drop from the previous close. This new low is notably below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a sustained bearish trend. The stock’s performance today was broadly in line with its sector peers, which also faced downward pressure.
In contrast, the broader market benchmark, the Sensex, opened slightly lower at 84,600.99 points, down 0.11%, and was trading near 84,668 points at the time of reporting. The Sensex remains within 1.76% of its 52-week high of 86,159.02, indicating relative resilience compared to Nikhil Adhesives’ performance. The Sensex’s 50-day moving average remains above its 200-day moving average, suggesting a more stable medium-term market trend.
Over the past year, Nikhil Adhesives Ltd has underperformed significantly, delivering a negative return of 33.62%, while the Sensex gained 8.17% over the same period. The stock’s 52-week high was Rs.129, underscoring the extent of the recent decline.
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Financial Performance and Growth Metrics
Examining the company’s financials reveals subdued long-term growth. Over the last five years, net sales have increased at an annualised rate of 8.55%, while operating profit has grown at 17.96% annually. These figures indicate moderate expansion but fall short of robust growth expectations within the Specialty Chemicals sector.
Recent results have shown some areas of concern. The operating cash flow for the fiscal year reached a low of Rs.6.90 crores, reflecting constrained liquidity generation. Profit after tax (PAT) for the latest six-month period stood at Rs.6.74 crores, representing a decline of 30.01% compared to the previous corresponding period. Additionally, cash and cash equivalents at half-year stood at Rs.2.13 crores, the lowest level recorded, which may impact the company’s short-term financial flexibility.
These financial indicators have contributed to the stock’s downgrade in rating. The company’s Mojo Score currently stands at 44.0, with a Mojo Grade of Sell, revised from Hold on 24 Nov 2025. The market capitalisation grade is rated 4, reflecting its micro-cap status within the Specialty Chemicals sector.
Relative Performance and Valuation
Nikhil Adhesives Ltd has consistently underperformed its benchmark indices over the past three years, including the BSE500. The stock’s negative return of 33.62% in the last year contrasts sharply with the broader market’s positive performance. Profitability has also declined, with profits falling by 11.9% over the same period.
Despite these challenges, the company exhibits certain strengths. Management efficiency remains high, as evidenced by a return on capital employed (ROCE) of 26.93%, indicating effective utilisation of capital resources. The company’s debt servicing capacity is strong, 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 company’s ROCE of 15.1% is paired with a low enterprise value to capital employed ratio of 2.3, indicating that the stock is trading at a discount compared to historical averages within the sector.
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Shareholding and Sector Positioning
The majority shareholding in Nikhil Adhesives Ltd remains with the promoters, maintaining a stable ownership structure. The company operates within the Specialty Chemicals industry, a sector characterised by cyclical demand and sensitivity to raw material price fluctuations. The stock’s recent price action and financial results reflect the challenges faced in this environment.
While the stock’s current valuation and financial ratios suggest some underlying strengths, the recent price decline to Rs.77.78 marks a significant milestone in its trading history, underscoring the need for close monitoring of its financial and market developments.
Summary of Key Metrics
To summarise, Nikhil Adhesives Ltd’s stock has reached a 52-week low of Rs.77.78, down 2.51% intraday and 1.32% on the day overall. The stock has declined by 33.62% over the past year, underperforming the Sensex by over 40 percentage points. Financially, the company has experienced a 30.01% decline in PAT over the latest six months and recorded its lowest operating cash flow and cash reserves in recent periods. Despite these headwinds, the company maintains a high ROCE of 26.93% and a low Debt to EBITDA ratio of 1.17 times, with valuation metrics indicating a discount relative to peers.
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