Scoobee Day Garments India Ltd Falls to 52-Week Low of Rs.67.3

Stock Price Movement and Market Context

The stock opened the day with a gap up of 5.78%, reaching an intraday high of Rs.73.2, but reversed course to close at its lowest point of Rs.67.3, down 2.75% on the day. This decline extended a three-day losing streak, during which the stock has fallen by 9.09%. The underperformance was notable against the Garments & Apparels sector, with Scoobee Day Garments lagging by 1.8% today.

Trading below all key moving averages—5-day, 20-day, 50-day, 100-day, and 200-day—the stock’s technical indicators reflect sustained downward momentum. This contrasts with the broader market, where the Sensex opened flat but traded lower by 0.27%, currently at 83,348.11 points, approximately 3.37% below its 52-week high of 86,159.02. The Sensex itself has been on a three-week consecutive decline, losing 2.81% in that period.

Financial Performance and Fundamental Concerns

Over the past year, Scoobee Day Garments has delivered a negative return of 43.95%, significantly underperforming the Sensex’s positive 8.78% return. The stock’s 52-week high was Rs.133.54, highlighting the extent of the recent decline.

The company’s financial metrics reveal several areas of concern. Its debt-equity ratio stands at a high 14.92 times, indicating a substantial leverage burden that weighs on long-term financial stability. This elevated debt level contributes to a weak long-term fundamental strength assessment, reflected in the company’s Mojo Grade of Strong Sell, upgraded from Sell on 2 Sep 2025, with a low Mojo Score of 20.0.

Net sales have grown at an annual rate of 19.13% over the last five years, but operating profit has remained flat, showing no growth. The company’s operating cash flow for the year was negative at Rs. -4.19 crores, while profit before tax excluding other income for the latest quarter plunged by 3602.7% to Rs. -3.24 crores compared to the previous four-quarter average. Net profit after tax for the quarter also declined sharply by 787.1% to Rs. -2.31 crores.

Long-Term and Recent Performance Trends

The stock’s underperformance extends beyond the past year. It has lagged the BSE500 index over the last three years, one year, and three months, indicating persistent challenges in generating shareholder value. Despite a 34% rise in profits over the past year, the company’s PEG ratio stands at a high 8.1, suggesting that profit growth has not translated into commensurate stock price appreciation.

Return on capital employed (ROCE) is modest at 3.2%, and the enterprise value to capital employed ratio is also 3.2, indicating a fair valuation relative to the company’s capital base. However, the stock trades at a discount compared to its peers’ average historical valuations, reflecting market caution.

Shareholding and Sectoral Position

The majority shareholding remains with promoters, maintaining control over corporate decisions. Scoobee Day Garments operates within the Garments & Apparels industry and sector, which has seen mixed performance amid broader economic fluctuations and sector-specific pressures.

Summary of Key Metrics

To summarise, Scoobee Day Garments India Ltd’s stock has reached a new 52-week low of Rs.67.3, reflecting a combination of weak financial results, high leverage, and sustained underperformance relative to market benchmarks. The stock’s technical indicators remain bearish, with prices below all major moving averages and a recent three-day decline of over 9%. The company’s financial health is challenged by a high debt-equity ratio of 14.92 times and negative cash flows, while profitability metrics have deteriorated sharply in recent quarters.

Despite some profit growth over the past year, the stock’s valuation metrics and market performance indicate ongoing caution among market participants. The Sensex’s own recent weakness adds to the challenging environment for the stock, which has not benefited from broader market gains.

Market and Sector Overview

The Garments & Apparels sector continues to face headwinds amid fluctuating demand and competitive pressures. Scoobee Day Garments’ performance must be viewed within this context, where sector peers have shown varied results. The stock’s discount to peer valuations suggests that investors are pricing in the company’s elevated risk profile and subdued growth prospects.

Technical and Valuation Insights

From a technical perspective, the stock’s position below all key moving averages signals a bearish trend. The gap up at the open followed by a sharp reversal to the day’s low indicates volatility and selling pressure. The stock’s market cap grade of 4 further reflects its relatively modest size and liquidity considerations within the broader market.

Valuation metrics such as the enterprise value to capital employed ratio of 3.2 and the PEG ratio of 8.1 highlight a disconnect between profit growth and market valuation, underscoring investor concerns about sustainability and financial leverage.

Conclusion

Scoobee Day Garments India Ltd’s recent fall to a 52-week low encapsulates a period of financial strain and market underperformance. The combination of high debt levels, negative cash flows, and declining profitability has weighed on the stock’s price, which now trades at a significant discount to its 52-week high and peer valuations. The broader market’s modest decline and sector-specific challenges provide additional context for the stock’s trajectory.

Investors and market watchers will continue to monitor the company’s financial disclosures and market movements closely as the stock remains under pressure amid these prevailing conditions.

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