Stock Performance and Market Context
On 29 Jan 2026, Shriram Finance Ltd’s stock price surged to Rs.1028.9, surpassing its previous 52-week high and demonstrating a notable gain of 0.49% on the day. The stock has been on an upward trajectory, recording consecutive gains over the last two sessions with a cumulative return of 2.14%. This rally places the stock well above its key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling strong technical momentum.
In contrast, the broader market showed signs of weakness, with the Sensex declining by 499.62 points (-0.58%) to close at 81,869.34 after a flat opening. Despite this, several indices such as NIFTY PSE, NIFTY CPSE, and NIFTY METAL reached new 52-week highs, indicating pockets of strength within the market.
Over the past year, Shriram Finance Ltd has delivered an impressive 84.88% return, significantly outperforming the Sensex’s modest 7.04% gain. The stock’s 52-week low was Rs.508.95, highlighting the substantial appreciation in value over the period.
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Fundamental Strength Underpinning the Rally
Shriram Finance Ltd’s recent price surge is supported by strong long-term fundamentals. The company boasts an average Return on Equity (ROE) of 14.00%, reflecting efficient capital utilisation and profitability. Its net sales have grown at an annualised rate of 22.46%, while operating profit has expanded at 23.66%, underscoring healthy business growth.
Quarterly financials further reinforce this strength, with the company reporting its highest-ever net sales of Rs.12,170.76 crores, profit before tax excluding other income at Rs.3,337.78 crores, and net profit after tax reaching Rs.2,529.67 crores. These figures mark nine consecutive quarters of positive results, highlighting consistent operational performance.
Institutional investors hold a significant 68.52% stake in the company, indicating strong confidence from entities with extensive analytical resources. This high institutional holding often correlates with stability and sustained interest in the stock.
Valuation and Risk Considerations
Despite the robust growth, Shriram Finance Ltd’s valuation metrics suggest a premium positioning. The stock trades at a Price to Book (P/B) ratio of 3.2, which is higher than the average historical valuations of its peers in the NBFC sector. The company’s ROE of 14.3% is solid but paired with this premium valuation, it indicates that investors are pricing in continued growth and quality.
Profit growth over the past year has been 13%, which, while positive, is more moderate compared to the stock’s price appreciation of 84.88%. This disparity results in a Price/Earnings to Growth (PEG) ratio of 1.6, suggesting that the stock’s price increase has outpaced earnings growth to some extent.
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Technical Momentum and Market Position
The stock’s position above all major moving averages signals strong technical momentum. This alignment often reflects positive investor sentiment and can act as a support level for future price stability. The recent two-day consecutive gains and the 2.14% return over this period further illustrate the stock’s upward trajectory.
Compared to the broader market, Shriram Finance Ltd’s performance stands out. While the Sensex is trading below its 50-day moving average, the stock’s ability to maintain gains and reach new highs highlights its relative strength within the NBFC sector.
Over the last three years, the stock has consistently outperformed the BSE500 index annually, reinforcing its status as a strong performer in its category.
Summary of Key Metrics
• New 52-week high: Rs.1028.9
• 1-year return: 84.88% vs Sensex 7.04%
• Average ROE: 14.00%
• Annual net sales growth: 22.46%
• Annual operating profit growth: 23.66%
• Institutional holdings: 68.52%
• Price to Book ratio: 3.2
• PEG ratio: 1.6
• Consecutive positive quarters: 9
• Market Cap Grade: 1
• Mojo Score: 72.0 (Upgraded from Hold to Buy on 15 Dec 2025)
The stock’s recent upgrade in Mojo Grade from Hold to Buy on 15 Dec 2025 reflects improved confidence in its fundamentals and market positioning. With a Mojo Score of 72.0, Shriram Finance Ltd is recognised for its strong financial health and growth prospects within the NBFC sector.
Conclusion
Shriram Finance Ltd’s attainment of a new 52-week high at Rs.1028.9 marks a significant milestone underscored by solid financial performance, strong institutional backing, and favourable technical indicators. Despite a premium valuation, the company’s consistent growth in sales, profits, and returns on equity have propelled the stock well ahead of the broader market indices. This achievement highlights Shriram Finance Ltd’s resilience and leadership within the NBFC sector amid a fluctuating market backdrop.
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