Stock Price Movement and Market Context
On 3 Feb 2026, Sakthi Finance Ltd’s share price touched Rs.30.7, its lowest level in the past year, representing a steep decline from its 52-week high of Rs.58.7. This marks a 47.7% drop from the peak price recorded within the last 12 months. The stock’s day change was marginally positive at 0.03%, yet it underperformed its sector by -3.62% on the day.
While the NBFC sector advanced by 3.67%, Sakthi Finance’s shares traded below all key moving averages — the 5-day, 20-day, 50-day, 100-day, and 200-day averages — signalling sustained downward momentum. In contrast, the Sensex opened with a gap up of 3,656.74 points but later lost 1,344.40 points to close at 83,978.80, still maintaining a position just 2.6% shy of its 52-week high of 86,159.02. The Sensex’s 50-day moving average remains above its 200-day moving average, indicating a generally positive medium-term trend for the broader market.
Financial Performance and Fundamental Assessment
Over the past year, Sakthi Finance Ltd has delivered a total return of -41.52%, significantly underperforming the Sensex’s 8.80% gain over the same period. The company’s long-term financial metrics reveal a subdued growth trajectory. Net sales have increased at an annualised rate of 4.69%, while operating profit growth has been similarly modest at 4.44% per annum.
The company’s average Return on Equity (ROE) stands at 6.25%, reflecting limited profitability relative to shareholder equity. This weak long-term fundamental strength has contributed to the stock’s downgrade in rating, with its Mojo Grade recently revised from Sell to Strong Sell as of 8 Jan 2026. The Mojo Score currently sits at 26.0, underscoring the stock’s challenging outlook based on MarketsMOJO’s comprehensive evaluation.
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Recent Quarterly and Debt Metrics
The company’s latest quarterly results have been largely flat, with Profit Before Tax excluding other income (PBT less OI) reported at Rs.5.46 crores, one of the lowest quarterly figures in recent periods. This subdued profitability adds to concerns about the company’s near-term earnings momentum.
Additionally, Sakthi Finance’s debt-equity ratio for the half-year period stands at a high 5.45 times, indicating a leveraged capital structure. This elevated leverage level may constrain financial flexibility and increase risk, particularly in a sector sensitive to interest rate fluctuations and credit conditions.
Comparative Valuation and Shareholding
Despite the weak price performance, Sakthi Finance Ltd’s valuation metrics present a contrasting picture. The stock trades at a Price to Book Value ratio of 0.9, which is below the average historical valuations of its peers in the NBFC sector. This suggests that the market currently prices the stock at a discount relative to its book value, reflecting investor caution.
The company’s ROE for the most recent period is slightly improved at 7.4%, and profits have risen by 6.9% over the past year. The Price/Earnings to Growth (PEG) ratio stands at 1.8, indicating a valuation that factors in moderate growth expectations.
Promoters remain the majority shareholders, maintaining significant control over the company’s strategic direction.
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Long-Term Performance Trends
Over a three-year horizon, Sakthi Finance Ltd has consistently underperformed the BSE500 index, reflecting persistent challenges in generating shareholder value. The stock’s negative returns over one year and three months further highlight the difficulties faced in reversing the downtrend.
In contrast, the broader NBFC sector and the Sensex have demonstrated resilience and growth, underscoring the divergence in performance between Sakthi Finance and its peers.
Sector and Market Dynamics
The NBFC sector has shown strength recently, with a 3.67% gain on the day Sakthi Finance hit its 52-week low. This sectoral outperformance is supported by improving credit demand and favourable market conditions. Meanwhile, the Sensex’s recovery from a gap-up opening to a close near its 52-week high reflects robust market sentiment, particularly led by mega-cap stocks.
However, Sakthi Finance’s share price movement remains disconnected from these positive trends, as it continues to trade below all major moving averages, signalling sustained investor caution.
Summary of Key Metrics
- New 52-week low price: Rs.30.7 (3 Feb 2026)
- 52-week high price: Rs.58.7
- 1-year return: -41.52%
- Average ROE: 6.25%
- Debt-Equity Ratio (HY): 5.45 times
- PBT less OI (Quarterly): Rs.5.46 crores
- Price to Book Value: 0.9
- PEG Ratio: 1.8
- Mojo Score: 26.0 (Strong Sell, upgraded from Sell on 8 Jan 2026)
- Sector performance on 3 Feb 2026: +3.67%
- Sensex performance on 3 Feb 2026: +2.83%
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