Rishi Laser Ltd Falls 10.13%: 2 Key Factors Behind the Sharp Decline

16 February: Quarterly Results Trigger Sharp Decline

On 16 February 2026, Rishi Laser Ltd reported a significant downturn in its December 2025 quarterly results, which triggered a 5.34% drop in its share price to Rs.110.75. The company’s net sales plunged to ₹36.39 crores, marking the lowest in recent quarters, while PBDIT fell sharply to ₹2.74 crores. Operating profit margin contracted to 7.53%, and the profit before tax excluding other income slipped into negative territory at ₹-0.03 crores. The profit after tax collapsed by 80.1% to ₹0.42 crores, dragging earnings per share down to ₹0.05. This deterioration in financial performance was reflected in a downgrade of the company’s Mojo Grade to Sell, with the Mojo Score falling to 31.0.

The stock’s intraday volatility was notable, with a high of Rs.130.95 and a low of Rs.112.00, as investors digested the disappointing results amid a broader market rally where the Sensex gained 0.70% to close at 36,787.89.

17 February: Continued Price Pressure Amid Weak Sentiment

Following the earnings shock, Rishi Laser’s share price continued to decline sharply by 6.14% to Rs.103.95 on 17 February, despite the Sensex advancing 0.32% to 36,904.38. The sustained selling pressure reflected investor caution and a reassessment of the company’s near-term prospects. Trading volumes halved compared to the previous day, indicating a more selective participation in the stock’s movement.

18 February: Minor Recovery as Market Stabilises

On 18 February, the stock saw a modest rebound, gaining 0.87% to close at Rs.104.85, as the Sensex continued its upward trend, rising 0.43% to 37,062.35. This slight recovery suggested some bargain hunting or short-term technical buying after the steep declines earlier in the week. However, volumes remained subdued at 10,138 shares, indicating cautious investor sentiment.

19 February: Slight Dip on Weak Market Day

The stock edged down 0.76% to Rs.104.05 on 19 February, in line with a weak Sensex session that fell 1.45% to 36,523.88. The broader market weakness, driven by profit-taking and sectoral pressures, weighed on Rishi Laser’s price, which remained volatile amid ongoing concerns about the company’s operational challenges and earnings outlook.

20 February: Modest Gain Closes the Week

Rishi Laser closed the week on a slightly positive note, rising 1.06% to Rs.105.15 as the Sensex recovered 0.41% to 36,674.32. This gain was modest and insufficient to offset the earlier losses, leaving the stock down 10.13% for the week. Trading volumes contracted to 6,830 shares, reflecting a cautious market stance ahead of further corporate updates.

Weekly Price Performance: Stock vs Sensex

Valuation Reset Highlights Attractive Price Levels

Alongside the earnings disappointment, Rishi Laser’s valuation metrics shifted markedly during the week, reflecting the sharp price correction. The stock’s price-to-earnings (P/E) ratio declined to 14.34, placing it favourably below many industrial manufacturing peers such as Salasar Techno (P/E 39.55) and JNK (P/E 29.36). The price-to-book value (P/BV) ratio also improved to 1.43, indicating the stock is trading close to its net asset value, a level often considered attractive for value investors.

Other valuation multiples such as enterprise value to EBITDA (EV/EBITDA) at 8.47 and EV to EBIT at 11.85 further underscore the stock’s relative cheapness compared to sector averages. This valuation reset comes despite the company’s operational challenges and a downgraded Mojo Grade of Sell, suggesting a nuanced investment case balancing near-term risks with longer-term value.

Key Takeaways

Negative Signals: The sharp quarterly decline in revenue and profitability, with PAT down 80.1% and operating margins at a historic low of 7.53%, signals significant near-term operational challenges. The downgrade to a Mojo Grade of Sell and a low Mojo Score of 31.0 reflect deteriorating fundamentals and cautious market sentiment. The stock’s 10.13% weekly decline, despite a rising Sensex, highlights its underperformance and investor concerns.

Positive Signals: Despite recent setbacks, Rishi Laser’s valuation metrics have become very attractive relative to peers, with a P/E of 14.34 and P/BV of 1.43. The company’s long-term returns remain impressive, with a three-year cumulative return of 297.96%, far outpacing the Sensex’s 36.73%. Solid returns on capital employed (13.29%) and equity (9.98%) underpin the company’s operational strength over time, suggesting potential value for long-term investors.

Conclusion

Rishi Laser Ltd’s week was dominated by a sharp earnings decline and a consequential share price correction that led to a 10.13% weekly fall, markedly underperforming the Sensex’s 0.39% gain. The company faces significant near-term headwinds, reflected in deteriorating profitability and a downgraded analyst rating. However, the valuation reset to very attractive levels relative to peers and the company’s strong long-term return track record provide a complex picture for investors.

Market participants should weigh the operational challenges and cautious sentiment against the improved price multiples and historical outperformance. The stock’s current price levels may appeal to value-oriented investors with a longer-term horizon, while near-term risks remain elevated. The coming quarters will be critical in assessing whether Rishi Laser can stabilise its financial performance and regain investor confidence.

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