Relicab Cable Manufacturing Faces Financial Struggles Amidst Stock Volatility and Weak Fundamentals

Relicab Cable Manufacturing has experienced significant volatility, hitting a new 52-week low of Rs. 56 today, marking a decline of 9.16% from the previous close. The stock has been on a downward trend for the past nine days, resulting in a cumulative drop of 27.07%. In comparison to its sector, Relicab has underperformed by 5.66% today. The company's recent financial performance has raised concerns, with net sales for the latest quarter falling by 11.73% to Rs. 6.62 crore. Additionally, the company's operating profit growth over the past five years has been modest at 7.47% CAGR, indicating weak long-term fundamentals. The EBIT to interest ratio stands at a concerning 1.50, suggesting challenges in servicing its debt. Relicab's technical indicators reflect a bearish trend, with the stock trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. The company's return on capital employed (ROCE) is at 9.2, coupled with a high enterprise value to capital employed ratio of 3.6, indicating an expensive valuation. Furthermore, 99.94% of promoter shares are pledged, which could exert additional pressure on the stock in a declining market.