Stock Price Movement and Market Context
The stock has declined by 2.01% today, underperforming its sector by 1.19%. This drop follows a two-day losing streak during which the stock has fallen by 9.09%. Sri Lakshmi Saraswathi Textiles (Arni) Ltd is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained bearish momentum.
In contrast, the broader market index, Sensex, experienced a negative session, closing down 389.56 points or 0.56% at 83,104.93. Despite this, Sensex remains only 3.67% below its 52-week high of 86,159.02. The index has been on a three-week consecutive decline, losing 3.1% over this period, with the 50-day moving average positioned above the 200-day moving average, indicating mixed technical signals.
Financial Performance and Fundamental Assessment
Over the past year, Sri Lakshmi Saraswathi Textiles (Arni) Ltd has delivered a total return of -39.14%, significantly underperforming the Sensex’s 8.47% gain. The stock’s 52-week high was Rs.51.80, underscoring the extent of the recent decline.
The company’s long-term fundamentals remain weak. It carries a negative book value and is classified as having weak long-term fundamental strength. Net sales have grown at a modest annual rate of 7.08% over the last five years, while operating profit has remained flat, showing no growth during the same period. The company’s average debt-to-equity ratio stands at zero, indicating a high debt burden relative to equity, which adds to financial risk.
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Recent Financial Metrics and Operational Indicators
The company reported flat results in the September 2025 half-year period. Operating cash flow for the year was notably low at Rs. -19.00 crores, reflecting cash outflows. Return on capital employed (ROCE) for the half-year was at a low 32.41%, indicating limited efficiency in generating returns from capital invested.
Debtors turnover ratio for the half-year was 39.28 times, the lowest recorded, suggesting slower collection cycles or increased receivables. Additionally, the company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) remain negative, contributing to the stock’s classification as risky compared to its historical valuation averages.
Performance Relative to Benchmarks
Consistent underperformance has been a hallmark of Sri Lakshmi Saraswathi Textiles (Arni) Ltd over the last three years. Alongside the -39.14% return in the past year, the stock has lagged behind the BSE500 index in each of the last three annual periods. Despite this, the company’s profits have risen by 19.8% over the past year, a factor that has not yet translated into positive stock price momentum.
Shareholding and Market Capitalisation
The majority shareholding remains with the promoters, maintaining control over the company’s strategic direction. The company holds a Market Cap Grade of 4, reflecting its micro-cap status within the Garments & Apparels sector. The Mojo Score stands at 12.0, with a recent downgrade from Sell to Strong Sell on 19 August 2025, underscoring the cautious stance on the stock’s outlook.
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Sector and Industry Considerations
Operating within the Garments & Apparels industry, Sri Lakshmi Saraswathi Textiles (Arni) Ltd faces sector-wide pressures including fluctuating raw material costs and competitive pricing dynamics. The company’s performance contrasts with broader sector trends, where some peers have managed to sustain growth and profitability despite market headwinds.
The stock’s current valuation and financial metrics reflect these challenges, with the Mojo Grade of Strong Sell indicating a cautious market view. The downgrade from Sell to Strong Sell in August 2025 highlights deteriorating fundamentals and valuation concerns.
Summary of Key Financial Indicators
To summarise, the company’s key financial indicators present a mixed picture:
- Negative book value indicating weak net asset position
- Flat operating profit growth over five years despite modest sales increase
- Negative operating cash flow of Rs. -19.00 crores for the year
- Low ROCE at 32.41% for the half-year period
- Negative EBITDA contributing to elevated risk profile
- Debtors turnover ratio at 39.28 times, the lowest in recent periods
These factors collectively contribute to the stock’s recent decline and its new 52-week low price point.
Conclusion
Sri Lakshmi Saraswathi Textiles (Arni) Ltd’s fall to Rs.24.89 marks a significant milestone in its recent price trajectory, reflecting a combination of subdued financial performance, valuation pressures, and sector challenges. The stock’s underperformance relative to the Sensex and BSE500 indices over multiple years underscores persistent difficulties in regaining investor confidence. While the broader market shows some resilience, the company’s financial and operational metrics continue to weigh on its share price.
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