On the trading day, Shakti Pumps recorded an intraday low of Rs.689, representing a 3.17% dip from its previous close. The stock has been on a downward trajectory for five consecutive sessions, accumulating a loss of 7.48% over this period. This performance contrasts with the broader sector, where Shakti Pumps underperformed by 2.24% today. The stock is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained downward momentum.
In comparison, the Sensex opened flat and traded marginally lower by 0.02%, standing at 84,657.26 points. The benchmark index remains close to its 52-week high of 85,290.06, just 0.75% away, supported by bullish moving averages where the 50-day moving average is positioned above the 200-day moving average. Mid-cap stocks showed slight gains, with the BSE Mid Cap index rising by 0.02%, highlighting a divergence from Shakti Pumps’ performance.
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Over the past year, Shakti Pumps has recorded a negative return of 14.73%, a stark contrast to the Sensex’s positive return of 9.13% over the same period. The stock’s 52-week high was Rs.1,398, indicating a substantial decline from its peak. Despite this, the company’s profits have shown a rise of 22.2% over the last year, with a PEG ratio of 1.2, suggesting that earnings growth has not translated into share price appreciation.
Financial metrics reveal a complex picture. The company’s operating cash flow for the year stands at Rs.20.49 crores, noted as the lowest in recent periods. Quarterly operating profit to interest coverage is at 10.22 times, also at a low point. The quarterly profit after tax (PAT) is Rs.90.71 crores, reflecting a decline of 10.6%. Return on Capital Employed (ROCE) is reported at 31.2%, indicating strong capital efficiency, yet the enterprise value to capital employed ratio is 4.9, pointing to a relatively high valuation compared to peers.
Shakti Pumps’ valuation appears elevated relative to its industry counterparts, trading at a premium compared to average historical valuations within the Compressors, Pumps & Diesel Engines sector. The company’s long-term fundamentals remain robust, with an average ROCE of 26.83% and healthy growth rates in net sales and operating profit, which have grown annually by 40.28% and 93.48% respectively. Additionally, the company maintains a low debt to EBITDA ratio of 0.76 times, indicating a strong capacity to service its debt obligations.
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Promoters remain the majority shareholders of Shakti Pumps, maintaining significant control over the company’s strategic direction. Despite the recent price decline, the company’s fundamentals reflect a capacity for sustained long-term growth, supported by strong capital returns and manageable leverage.
In summary, Shakti Pumps (India) has experienced a notable decline to its 52-week low of Rs.689, with the stock underperforming both its sector and the broader market indices. The company’s financial data presents a mixed scenario of strong profitability metrics alongside valuation premiums and recent profit contractions. Market participants will observe how these factors continue to influence the stock’s trajectory in the near term.
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