Stock Performance and Market Context
On 31 Dec 2025, Shree Karthik Papers Ltd recorded its lowest price in the past year at Rs.6.81, continuing a losing streak that has spanned seven consecutive trading sessions. Over this period, the stock has declined by 10.13%, underperforming the Paper, Forest & Jute Products sector by 2.12% on the day. The stock currently trades below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling persistent bearish momentum.
In contrast, the broader market has shown resilience. The Sensex opened 118.50 points higher and is trading at 84,948.11, up 0.32%, and remains just 1.43% shy of its 52-week high of 86,159.02. The Sensex is supported by bullish moving averages, with the 50-day moving average positioned above the 200-day moving average. Additionally, the BSE Small Cap index gained 0.86%, indicating strength in smaller capitalisation stocks, a segment where Shree Karthik Papers Ltd is classified.
Long-Term and Recent Performance Metrics
Over the last twelve months, Shree Karthik Papers Ltd has delivered a total return of -39.83%, a stark contrast to the Sensex’s positive 8.70% return over the same period. The stock’s 52-week high was Rs.12.79, highlighting the extent of the decline. The company has also underperformed the BSE500 index across multiple time frames, including the last three years, one year, and three months, indicating sustained challenges in maintaining competitive performance.
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Financial Health and Valuation Concerns
Shree Karthik Papers Ltd’s financial profile reveals several areas of concern. The company carries a high debt burden, with a debt-to-equity ratio of 7.65 times, indicating significant leverage and potential strain on long-term financial stability. This elevated debt level contributes to a weak long-term fundamental strength assessment.
Growth metrics over the past five years show net sales increasing at an annual rate of 21.52%, while operating profit has remained flat, registering 0% growth. This stagnation in profitability contrasts with the sales growth and suggests margin pressures or cost inefficiencies. Operating cash flow for the fiscal year was notably low at Rs.1.15 crore, the lowest recorded, further underscoring liquidity constraints.
The company’s return on capital employed (ROCE) stands at a modest 1.1%, reflecting limited efficiency in generating returns from its capital base. Valuation metrics indicate an enterprise value to capital employed ratio of 1.4, which is considered expensive relative to the company’s financial performance. Despite this, the stock trades at a discount compared to its peers’ average historical valuations, reflecting market caution.
Profitability and Shareholder Structure
Profitability has deteriorated over the past year, with reported profits falling by 37%. This decline aligns with the stock’s negative return trajectory and highlights challenges in sustaining earnings. The company’s shareholder base is dominated by promoters, who hold the majority stake, maintaining control over strategic decisions and corporate governance.
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Mojo Score and Analyst Ratings
According to MarketsMOJO’s assessment, Shree Karthik Papers Ltd holds a Mojo Score of 17.0, categorised under a Strong Sell rating. This represents a downgrade from its previous Sell grade as of 21 Jan 2025. The company’s market capitalisation grade is rated at 4, reflecting its micro-cap status and associated liquidity considerations. These ratings encapsulate the company’s financial challenges and market performance trends.
Summary of Key Metrics
To summarise, Shree Karthik Papers Ltd’s stock has reached a 52-week low of Rs.6.81 after a sustained decline of over 10% in the past week. The company faces a high debt load, flat operating profit growth despite sales increases, and diminished profitability. Its valuation metrics suggest an expensive capital structure relative to returns generated. The stock’s performance has lagged significantly behind the broader market and sector indices, reflecting ongoing pressures within the Paper, Forest & Jute Products industry segment.
Market Environment and Sector Comparison
While Shree Karthik Papers Ltd struggles, the broader market environment remains positive. The Sensex’s proximity to its 52-week high and the outperformance of small-cap stocks highlight a divergence between the company’s stock and general market trends. The Paper, Forest & Jute Products sector has seen mixed results, with some peers maintaining steadier valuations and growth trajectories. This contrast emphasises the specific challenges faced by Shree Karthik Papers Ltd within its industry.
Conclusion
The new 52-week low for Shree Karthik Papers Ltd at Rs.6.81 marks a notable milestone in the company’s recent market journey. The combination of high leverage, subdued profitability, and underwhelming returns has contributed to this decline. Despite a positive broader market backdrop, the stock’s performance remains subdued, reflecting the company’s current financial and valuation realities.
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