Sakthi Finance Ltd Falls to 52-Week Low of Rs.32.52 Amidst Continued Downtrend

Recent Price Movement and Market Context

On 28 Jan 2026, Sakthi Finance’s share price touched Rs.32.52, the lowest level in the past year, down from its 52-week high of Rs.59.69. This decline contrasts sharply with the broader Finance/NBFC sector, which gained 2.06% on the same day. The stock underperformed its sector by 4.68% today, reflecting persistent selling pressure. Notably, the Sensex opened flat but gained 0.21% to trade at 82,028.65, supported by mega-cap stocks and sectors such as metals hitting new 52-week highs.

Sakthi Finance’s price currently trades below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a sustained bearish trend. This technical positioning highlights the stock’s weak momentum relative to both its sector and the broader market.

Long-Term Performance and Financial Metrics

Over the past year, Sakthi Finance has delivered a negative return of 40.09%, significantly lagging the Sensex’s positive 8.03% gain during the same period. The stock’s underperformance extends beyond the last 12 months, with returns trailing the BSE500 index over the last three years, one year, and three months.

Fundamental indicators reveal challenges in growth and profitability. The company’s average Return on Equity (ROE) stands at a modest 6.25%, reflecting limited efficiency in generating shareholder returns. Net sales have grown at an annualised rate of 4.69%, while operating profit has increased by 4.44% annually, indicating subdued expansion in core business operations.

Recent quarterly results for September 2025 were largely flat, with Profit Before Tax excluding other income (PBT less OI) reported at Rs.5.46 crore, one of the lowest levels recorded. The company’s debt-equity ratio remains elevated at 5.45 times as of the half-year mark, underscoring a relatively high leverage position within the NBFC sector.

Valuation and Peer Comparison

Despite the weak price performance, Sakthi Finance’s valuation metrics suggest a degree of market discount. The stock trades at a Price to Book Value of 0.9, below the average historical valuations of its peers. Its ROE of 7.4% is marginally higher than the long-term average, and profits have risen by 6.9% over the past year, resulting in a Price/Earnings to Growth (PEG) ratio of 1.8.

These valuation factors indicate that the market currently prices the stock with caution, reflecting concerns about growth sustainability and financial leverage. The company’s promoter group remains the majority shareholder, maintaining control over strategic decisions.

Market Ratings and Analyst Assessments

MarketsMOJO assigns Sakthi Finance a Mojo Score of 26.0, categorising it as a Strong Sell. This rating was upgraded from Sell to Strong Sell on 8 Jan 2026, reflecting deteriorating fundamentals and price momentum. The company’s Market Cap Grade is rated 4, indicating a relatively small market capitalisation within its sector.

The downgrade in grading aligns with the stock’s sustained price weakness and below-par financial performance. The combination of high leverage, modest profitability, and limited growth has contributed to the cautious stance adopted by rating agencies and market analysts.

Sector and Broader Market Environment

While Sakthi Finance has struggled, the broader NBFC sector has shown resilience, gaining 2.06% on the day. The Sensex, despite opening flat, has managed to maintain a positive trajectory, supported by mega-cap stocks and sectors such as metals reaching new highs. The Sensex trades below its 50-day moving average, though the 50DMA remains above the 200DMA, signalling mixed technical signals for the broader market.

The divergence between Sakthi Finance’s performance and that of its sector peers highlights company-specific factors influencing investor sentiment and price action.

Summary of Key Concerns

The stock’s fall to Rs.32.52, its lowest in 52 weeks, is a culmination of several factors: subdued growth rates, limited profitability improvements, elevated debt levels, and a persistent downtrend in price momentum. The six-day consecutive decline and trading below all major moving averages underscore the prevailing bearish sentiment.

While valuation metrics suggest the stock is trading at a discount relative to peers, the fundamental challenges and market rating of Strong Sell reflect ongoing caution among market participants.

Conclusion

Sakthi Finance Ltd’s recent price action and financial metrics paint a picture of a company facing multiple headwinds within the NBFC sector. The stock’s new 52-week low at Rs.32.52 marks a significant point in its price history, reflecting both market and company-specific pressures. The divergence from sector gains and broader market strength further emphasises the challenges faced by the company in the current environment.

Upgrade at special rates, valid only for the next few days. Claim Your Special Rate →