The stock’s latest price of Rs.5.24 represents a decline of 61.58% over the last 12 months, a stark contrast to the Sensex’s positive performance of 10.16% during the same period. While the benchmark index has recently hit a new 52-week high of 85,462.24, buoyed by gains in mega-cap stocks and trading above its 50-day and 200-day moving averages, Shyam Century Ferrous remains below all key moving averages including the 5-day, 20-day, 50-day, 100-day, and 200-day averages. This technical positioning underscores the stock’s current weakness relative to the broader market.
Over the past year, the company’s financial metrics have shown subdued trends. Net sales have recorded a compound annual rate of decline at approximately 5.57% over the last five years, while operating profit has contracted at a rate exceeding 200% in the same timeframe. The latest quarterly net sales figure stands at Rs.7.23 crore, which is the lowest recorded in recent quarters. Furthermore, the company’s profit after tax (PAT) for the latest six-month period is at a negative Rs.3.23 crore, reflecting a contraction of 63.27% compared to prior periods.
Perfect timing to enter! This Small Cap from IT - Software just turned profitable with growth momentum clearly building up. Get in before the broader market notices!
- - New profitability achieved
- - Growth momentum building
- - Under-the-radar entry
Non-operating income has accounted for a substantial portion of profit before tax (PBT), reaching 453.85% of PBT in the latest quarter. This indicates that core business activities are under pressure, with earnings increasingly reliant on non-operating sources. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) have been negative, which adds to the cautious outlook on its financial health.
Promoter shareholding has also seen a marginal reduction, with a decrease of 0.62% in the previous quarter, bringing promoter ownership to 49.56%. This slight decline in promoter stake may be interpreted as a shift in confidence levels regarding the company’s near-term prospects.
In terms of valuation, the stock is trading at levels considered risky when compared to its historical averages. The consistent underperformance against the BSE500 index over the last three years further highlights the challenges faced by Shyam Century Ferrous. Despite operating in the ferrous metals sector, which has seen varied performance, the company’s returns have lagged significantly behind sector peers and the broader market.
Why settle for Shyam Century Ferrous ? SwitchER evaluates this Ferrous Metals micro-cap against peers, other sectors, and market caps to find you superior investment opportunities!
- - Comprehensive evaluation done
- - Superior opportunities identified
- - Smart switching enabled
Despite these headwinds, the company maintains a low average debt-to-equity ratio, effectively at zero, which suggests limited leverage on its balance sheet. This aspect may provide some financial flexibility, although it has not yet translated into a reversal of the stock’s downward trend.
In summary, Shyam Century Ferrous’s stock price touching Rs.5.24 today marks a continuation of a prolonged period of subdued performance. The company’s financial indicators, including declining sales, negative profitability, and promoter stake reduction, align with the stock’s current position below all major moving averages. Meanwhile, the broader market, led by mega-cap stocks and the Sensex’s new highs, presents a contrasting backdrop to the stock’s performance.
Get 2 full years of MojoOne Premium for only Rs. 12,999. Subscribe for 1 year and we'll add another year FREE. Offer valid for a limited time. Start Saving Now →
