Siyaram Silk Mills Ltd Valuation Shifts Amid Market Pressure

Valuation Metrics: A Closer Look

At the close on 29 Jan 2026, Siyaram Silk’s stock price stood at ₹522.10, down 6.36% from the previous close of ₹557.55. The stock has traded within a 52-week range of ₹502.00 to ₹900.00, indicating significant volatility over the past year. The company’s current price-to-earnings (P/E) ratio is 11.55, a figure that has contributed to its upgraded valuation grade from very attractive to attractive. This P/E is considerably lower than many of its peers in the Garments & Apparels sector, where companies such as Tips Music and Ethos trade at P/E multiples of 37.15 and 70.02 respectively, signalling a more reasonable valuation for Siyaram Silk relative to sector standards.

Similarly, the price-to-book value (P/BV) ratio of 1.75 remains modest, suggesting that the stock is trading close to its book value, which can be appealing for value-oriented investors. The enterprise value to EBITDA (EV/EBITDA) ratio of 8.33 further supports this view, positioning Siyaram Silk as attractively priced compared to peers like Saregama India (20.38) and Timex Group (35.45). These multiples indicate that the market is currently assigning a lower premium to Siyaram Silk’s earnings and operational cash flows, potentially reflecting concerns over near-term performance but also offering a margin of safety.

Peer Comparison and Sector Context

Within the Garments & Apparels sector, Siyaram Silk’s valuation stands out as comparatively attractive. While companies such as Devyani International and Restaurant Brand are loss-making and thus lack meaningful P/E ratios, others like Vaibhav Global and Rupa & Co share a similar valuation profile with P/E ratios of 18.66 and 15.91 respectively. Siyaram Silk’s lower P/E ratio of 11.55 suggests a discount relative to these peers, which may be justified by its recent financial performance or market sentiment but also highlights potential upside if operational improvements materialise.

Moreover, the company’s return on capital employed (ROCE) and return on equity (ROE) metrics, at 15.10% and 15.45% respectively, demonstrate solid profitability and efficient capital utilisation. These returns are healthy within the sector and provide a fundamental underpinning to the valuation, indicating that the company is generating reasonable returns on invested capital despite the subdued market valuation.

Stock Performance Versus Market Benchmarks

Examining Siyaram Silk’s stock returns relative to the Sensex reveals a challenging period for shareholders. Over the past week, the stock has declined by 9.09%, while the Sensex gained 0.53%. The one-month and year-to-date returns are also negative at -19.60% and -17.61% respectively, compared to Sensex returns of -3.17% and -3.37%. Over a longer horizon, the stock has underperformed the Sensex over one and three years, with returns of -34.49% and -3.28% against Sensex gains of 8.49% and 38.79%. However, the five-year and ten-year returns tell a different story, with Siyaram Silk delivering 185.93% and 143.63% respectively, outperforming the Sensex’s 75.67% and 236.52% over the same periods. This mixed performance underscores the cyclical nature of the stock and the importance of valuation in timing investment decisions.

Mojo Score and Market Sentiment

Siyaram Silk currently holds a Mojo Score of 28.0, with a Mojo Grade of Strong Sell, upgraded from Sell on 28 Jan 2026. This downgrade in sentiment reflects caution among analysts and investors, likely driven by recent price declines and sector headwinds. The market capitalisation grade stands at 3, indicating a small-cap status with associated liquidity and volatility considerations. Despite the attractive valuation metrics, the negative sentiment and recent price weakness suggest that investors should approach the stock with prudence, balancing valuation appeal against operational and market risks.

Dividend Yield and Earnings Growth Prospects

The company offers a dividend yield of 2.30%, which is modest but provides some income cushion for investors. The PEG ratio of 2.02 indicates that the stock is trading at a premium relative to its earnings growth rate, suggesting that while the valuation is attractive on a P/E basis, growth expectations are factored into the price. This contrasts with some peers like Vaibhav Global, which has a PEG ratio of 0.41, signalling potentially undervalued growth prospects. Investors should consider the sustainability of earnings growth and dividend payments when evaluating the stock’s attractiveness.

Historical Valuation Trends

Historically, Siyaram Silk’s P/E ratio has fluctuated in line with sector cycles and company performance. The current P/E of 11.55 is below the sector average, which has been elevated by high-growth and loss-making companies. The shift from very attractive to attractive valuation grade reflects a recalibration rather than a deterioration, signalling that while the stock remains reasonably priced, the margin of safety has narrowed slightly. This nuanced change suggests that the market is beginning to price in some recovery or stabilisation, but investors should remain vigilant for further developments.

Investment Implications

For investors seeking exposure to the Garments & Apparels sector, Siyaram Silk presents a compelling valuation case, particularly given its solid profitability metrics and reasonable price multiples. However, the strong sell Mojo Grade and recent price underperformance highlight the risks inherent in the current market environment. A cautious approach, potentially involving phased entry or monitoring for confirmation of operational improvements, may be prudent.

Conclusion

Siyaram Silk Mills Ltd’s recent valuation shift to an attractive rating, supported by a P/E of 11.55 and P/BV of 1.75, positions the stock as a potentially compelling value play within the Garments & Apparels sector. While the company’s profitability metrics and dividend yield provide fundamental support, the prevailing negative market sentiment and strong sell rating caution investors to weigh risks carefully. The stock’s underperformance relative to the Sensex over short and medium terms contrasts with its long-term gains, underscoring the importance of timing and valuation in investment decisions. Ultimately, Siyaram Silk offers an intriguing proposition for value-focused investors willing to navigate sector volatility and monitor operational developments closely.