Key Events This Week
09 Feb: Stock closes at Rs.273.85, up 2.14%
10 Feb: MarketsMOJO upgrades SRG Housing Finance Ltd to Sell on improved valuation and financial trends
10 Feb: Valuation grade shifts from expensive to attractive amid mixed market returns
13 Feb: Week closes at Rs.267.10, down 0.37% for the week
09 February 2026: Strong Start with 2.14% Gain
SRG Housing Finance Ltd opened the week on a positive note, closing at Rs.273.85, a 2.14% increase from the previous Friday’s close of Rs.268.10. This rise outperformed the Sensex, which gained 1.04% to close at 37,113.23. The stock’s trading range for the day was between Rs.268.20 and Rs.280.00, reflecting some renewed buying interest. This initial strength set the tone for the week, signalling a tentative recovery in investor sentiment ahead of the key rating and valuation announcements.
10 February 2026: Upgrade to Sell Rating and Valuation Recalibration
The most significant development of the week occurred on 10 February when MarketsMOJO upgraded SRG Housing Finance Ltd’s investment rating from 'Strong Sell' to 'Sell'. This upgrade was driven by improved valuation metrics and positive financial trends despite ongoing challenges in the company’s long-term fundamentals.
The stock’s price-to-earnings (P/E) ratio was noted at 14.61, a level that prompted a reclassification of its valuation from expensive to attractive. The price-to-book (P/B) ratio stood at 1.54, indicating a moderate premium to book value. Other valuation multiples such as EV/EBIT at 10.46 and EV/EBITDA at 9.87 further supported this improved valuation stance.
Financially, SRG Housing Finance reported its tenth consecutive quarter of positive results in Q3 FY25-26, with profit before tax excluding other income rising 63.37% to ₹9.59 crores and net profit after tax increasing 43.0% to ₹8.21 crores. Net sales reached a record ₹50.45 crores. Return on capital employed (ROCE) and return on equity (ROE) were moderate at 10.32% and 10.54% respectively, reflecting steady operational efficiency.
Despite these positives, the stock price declined 1.37% to Rs.270.10 on the day, underperforming the Sensex’s 0.25% gain. This reaction suggests that while the upgrade was welcomed, investors remained cautious given the company’s weak long-term fundamentals and recent underperformance relative to the broader market.
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11 February 2026: Continued Price Pressure Despite Sector Stability
On 11 February, SRG Housing Finance’s stock price declined further by 1.11% to Rs.267.10, closing at the same level on the following two trading days. This decline came despite the Sensex continuing to rise modestly by 0.13% to 37,256.72. The volume surged significantly to 1,002 shares, indicating increased trading activity possibly driven by the recent rating upgrade and valuation news.
The stock’s inability to sustain gains amid a broadly stable market highlights lingering investor caution. The company’s long-term underperformance remains a concern, with a 14.69% loss over the past year compared to the Sensex’s 7.97% gain. However, the stock’s 10-year cumulative return of 265.13% still outpaces the Sensex’s 249.97%, suggesting a resilient long-term growth trajectory.
12-13 February 2026: Stability Amid Market Decline
SRG Housing Finance’s stock price remained steady at Rs.267.10 on both 12 and 13 February, even as the Sensex declined by 0.56% and 1.40% respectively. This relative stability amid a weakening market indicates some defensive qualities in the stock, possibly reflecting the improved valuation and the recent upgrade.
Volume remained elevated at 1,002 shares on these days, supporting the notion of sustained investor interest despite the broader market downturn. The week closed with the stock down 0.37%, outperforming the Sensex’s 0.54% decline, albeit modestly.
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-09 | Rs.273.85 | +2.14% | 37,113.23 | +1.04% |
| 2026-02-10 | Rs.270.10 | -1.37% | 37,207.34 | +0.25% |
| 2026-02-11 | Rs.267.10 | -1.11% | 37,256.72 | +0.13% |
| 2026-02-12 | Rs.267.10 | +0.00% | 37,049.40 | -0.56% |
| 2026-02-13 | Rs.267.10 | +0.00% | 36,532.48 | -1.40% |
Key Takeaways
Positive Signals: The upgrade from 'Strong Sell' to 'Sell' by MarketsMOJO reflects improved valuation and financial trends, including a reasonable P/E ratio of 14.61 and steady profitability metrics. The stock’s relative stability in a declining market and its long-term cumulative returns exceeding the Sensex highlight underlying resilience.
Cautionary Notes: Despite the upgrade, the stock underperformed the Sensex over the past year and showed limited price appreciation following the announcement. Moderate returns on equity and capital employed, combined with sectoral challenges, suggest that the company’s fundamentals remain mixed. The modest trading volumes on some days also indicate cautious investor engagement.
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Conclusion
SRG Housing Finance Ltd’s week was defined by a cautious but meaningful upgrade in its investment rating and valuation status, which tempered the stock’s price decline relative to the broader market. While the company’s improved valuation metrics and positive quarterly financial results offer some encouragement, the stock’s recent underperformance and moderate profitability ratios suggest that challenges remain. Investors should monitor the stock’s price action and sector developments closely to assess whether the tentative recovery momentum can be sustained in the coming weeks.
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