Recent Price Movement and Market Context
On 18 Feb 2026, Sakthi Finance Ltd’s share price fell by 2.63% to reach Rs.26.99, the lowest level recorded in the past year. This decline comes after five consecutive days of losses, during which the stock has depreciated by 12.32%. The stock’s performance today notably underperformed its sector by 2.24%, indicating relative weakness within the NBFC space.
Technical indicators further highlight the bearish momentum, with the stock trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day. This broad-based weakness in moving averages suggests a persistent downtrend without immediate signs of reversal.
In contrast, the broader market, represented by the Sensex, opened positively but slipped into negative territory, closing at 83,266.92, down 0.22%. The Sensex remains 3.47% below its 52-week high of 86,159.02 and is trading below its 50-day moving average, although the 50DMA remains above the 200DMA, signalling mixed market conditions.
Long-Term Performance and Comparative Analysis
Over the last year, Sakthi Finance Ltd has delivered a total return of -42.54%, significantly lagging behind the Sensex’s positive 9.61% return over the same period. The stock’s 52-week high was Rs.58, underscoring the steep decline to its current level. This underperformance extends beyond the past year, with the stock also trailing the BSE500 index over the last three years, one year, and three months.
The company’s market capitalisation grade stands at 4, reflecting its relatively modest size within the NBFC sector. Its Mojo Score, a comprehensive measure of stock quality and momentum, is 17.0, categorised as a Strong Sell. This represents a downgrade from a previous Sell rating on 8 Jan 2026, indicating deteriorating sentiment and fundamentals.
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Financial Metrics and Profitability Concerns
Sakthi Finance Ltd’s financial performance has been subdued, with weak long-term fundamentals contributing to the stock’s decline. The company’s average Return on Equity (ROE) stands at 6.25%, which is modest for the NBFC sector and indicates limited profitability relative to shareholder equity.
Net sales have grown at an annualised rate of 4.61%, while operating profit has increased by 4.66% annually, both figures reflecting slow growth. The latest quarterly results for December 2025 further highlight challenges, with Profit Before Tax excluding Other Income (PBT LESS OI) at a low Rs.1.39 crore and Profit After Tax (PAT) at Rs.3.75 crore, the lowest recorded in recent quarters.
Additionally, the company’s debt-equity ratio at the half-year mark is elevated at 5.45 times, signalling a high leverage position that may constrain financial flexibility and increase risk.
Valuation and Shareholding Structure
Despite the weak performance, Sakthi Finance Ltd’s valuation metrics suggest a very attractive price point. The stock trades at a Price to Book Value (P/BV) of 0.8, indicating it is priced below its book value and at a discount relative to its peers’ historical averages. This valuation discount reflects market caution given the company’s recent results and financial ratios.
The majority shareholding is held by promoters, which often implies a stable ownership structure, though it has not prevented the stock’s recent decline.
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Summary of Performance Trends
The stock’s trajectory over the past year has been characterised by sustained negative returns and underperformance relative to key benchmarks. The -42.54% return contrasts sharply with the Sensex’s positive 9.61% gain, underscoring the stock’s relative weakness.
Profitability has also seen a marginal decline, with profits falling by 0.2% over the past year. This stagnation in earnings growth, combined with high leverage and modest ROE, has contributed to the cautious market stance.
Overall, Sakthi Finance Ltd’s current valuation reflects these factors, with the market pricing in the challenges faced by the company and its subdued growth prospects.
Market and Sector Positioning
Within the NBFC sector, Sakthi Finance Ltd’s performance and valuation metrics place it at a disadvantage compared to peers. The sector itself has experienced mixed results, but Sakthi Finance’s consistent underperformance and deteriorating Mojo Grade from Sell to Strong Sell on 8 Jan 2026 highlight specific concerns.
The stock’s current market cap grade of 4 indicates a smaller market capitalisation relative to larger NBFCs, which may affect liquidity and investor attention.
Concluding Observations
Sakthi Finance Ltd’s fall to a 52-week low of Rs.26.99 reflects a combination of subdued financial results, high leverage, and slow growth metrics. The stock’s underperformance relative to the Sensex and its sector, alongside a downgrade in its Mojo Grade, signals ongoing challenges in its business environment and market perception.
While the valuation appears attractive on a price-to-book basis, the company’s profitability and leverage ratios remain areas of concern. The stock’s technical indicators confirm a bearish trend, with prices below all major moving averages and a recent string of losses.
Investors and market participants will continue to monitor Sakthi Finance Ltd’s financial disclosures and market developments closely as the company navigates these conditions.
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