Shiva Texyarn Ltd Valuation Shifts to Attractive Amid Mixed Market Returns

Valuation Metrics and Recent Changes

As of early February 2026, Shiva Texyarn’s price-to-earnings (P/E) ratio stands at 14.03, a figure that positions the stock favourably against many of its peers in the garments and apparels industry. This P/E is significantly lower than competitors such as R&B Denims and SBC Exports, which trade at elevated multiples of 45.79 and 48.65 respectively, indicating that Shiva Texyarn remains relatively undervalued on earnings grounds.

Similarly, the price-to-book value (P/BV) ratio of 1.58 suggests a moderate premium over book value, reflecting a balanced market view of the company’s asset base. This contrasts with the broader sector where several peers command much higher valuations, often exceeding 3.0 times book value, signalling that Shiva Texyarn’s shares may offer a more reasonable entry point for value-conscious investors.

Enterprise value to EBITDA (EV/EBITDA) at 8.03 further underscores the stock’s attractive valuation, especially when compared to the sector heavyweights like SBC Exports and Pashupati Cotsp., which trade at multiples above 50. This metric is crucial as it accounts for debt and cash levels, providing a clearer picture of operational profitability relative to enterprise value.

Peer Comparison and Industry Context

Within the Garments & Apparels sector, Shiva Texyarn’s valuation stands out as attractive, especially when juxtaposed with the ‘very expensive’ tags assigned to several competitors. For instance, Sumeet Industries and One Global Services trade at P/E multiples of 72.96 and 29.59 respectively, reflecting market expectations of higher growth or superior profitability, but also implying greater risk and premium pricing.

On the other hand, companies like Sportking India and Mafatlal Industries share a similar valuation band with Shiva Texyarn, with P/E ratios of 11.21 and 10.36 respectively, reinforcing the notion that the stock is priced within a reasonable range relative to its sector peers.

Shiva Texyarn’s PEG ratio of 0.31 is particularly noteworthy, indicating that the stock is undervalued relative to its earnings growth potential. This is a stark contrast to peers such as R&B Denims and Pashupati Cotsp., whose PEG ratios hover around or above 1.0, suggesting that Shiva Texyarn may offer superior value for growth investors.

Financial Performance and Quality Metrics

Shiva Texyarn’s return on capital employed (ROCE) of 9.93% and return on equity (ROE) of 11.33% reflect moderate profitability levels. While these figures are not industry-leading, they demonstrate consistent operational efficiency and shareholder returns. The company’s dividend yield remains modest at 0.34%, which may limit appeal for income-focused investors but aligns with the sector’s typical payout patterns.

Enterprise value to capital employed (EV/CE) at 1.34 and EV to sales at 0.93 further indicate that the company is reasonably priced relative to its asset base and revenue generation capacity. These metrics suggest that Shiva Texyarn is not overleveraged and maintains a balanced capital structure, which is a positive sign amid volatile market conditions.

Stock Price Movement and Market Returns

Shiva Texyarn’s current share price of ₹174.00 is close to its 52-week low of ₹157.15, having retreated from a high of ₹249.50. The stock has experienced a slight decline of 0.40% on the day, reflecting cautious investor sentiment. Over the past year, the stock has underperformed the Sensex, delivering a negative return of 21.27% compared to the benchmark’s 7.07% gain. However, over longer horizons, Shiva Texyarn has outpaced the Sensex, with a 3-year return of 44.40% versus 38.13% for the index, and a 10-year return of 46.34% against the Sensex’s 239.52%.

This mixed performance underscores the cyclical nature of the garments and apparels sector and the stock’s sensitivity to broader economic trends and consumer demand fluctuations.

Mojo Score and Rating Update

MarketsMOJO’s latest assessment assigns Shiva Texyarn a Mojo Score of 26.0, categorising it as a Strong Sell. This represents a downgrade from the previous Sell rating as of 5 January 2026, signalling increased caution among analysts. The Market Cap Grade remains at 4, indicating a mid-sized market capitalisation that may limit liquidity and institutional interest.

The downgrade reflects concerns over the company’s growth prospects and valuation sustainability, despite the attractive P/E and EV/EBITDA multiples. Investors should weigh these factors carefully against the company’s fundamentals and sector outlook.

Historical Valuation Context and Investor Takeaways

Historically, Shiva Texyarn’s valuation has oscillated between very attractive and attractive levels, reflecting the company’s earnings volatility and sector cyclicality. The recent shift to an attractive valuation grade suggests that the market is beginning to price in some recovery potential, albeit cautiously.

Investors should consider the stock’s relative valuation advantages against its peers, particularly the low PEG ratio signalling undervaluation relative to growth. However, the strong sell rating and recent price underperformance caution against aggressive accumulation without a clear catalyst for earnings improvement.

Given the company’s moderate profitability metrics and subdued dividend yield, Shiva Texyarn may appeal more to value investors with a longer-term horizon who are comfortable navigating sector cyclicality and market volatility.

In summary, while Shiva Texyarn’s valuation parameters have improved, signalling a more attractive entry point, the overall market sentiment remains cautious. A balanced approach, incorporating peer comparisons and fundamental analysis, is advisable for investors considering this stock.

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