Stock Price Movement and Market Context
On 8 December 2025, Sterling & Wilson Renewable Energy's share price touched an intraday low of Rs.210.35, representing a fall of 4.86% on the day. This decline contributed to a four-day consecutive downward trend, during which the stock has recorded a cumulative return of -9.27%. The day's performance also showed the stock underperforming its sector by 4.4%, indicating relative weakness compared to its construction peers.
The stock is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages. This technical positioning suggests sustained selling pressure over multiple time horizons.
In contrast, the broader market index, the Sensex, opened flat but later traded lower by 0.33%, standing at 85,433.48 points. The Sensex remains close to its 52-week high of 86,159.02, with a margin of approximately 0.85%. Notably, the Sensex is positioned above its 50-day moving average, which itself is above the 200-day moving average, reflecting a generally bullish market trend that Sterling & Wilson Renewable Energy has not mirrored.
Long-Term Performance and Financial Indicators
Over the past year, Sterling & Wilson Renewable Energy's stock has recorded a return of -59.52%, a stark contrast to the Sensex's positive 4.49% return during the same period. The stock's 52-week high was Rs.526, underscoring the extent of the decline to the current low.
Several financial metrics provide insight into the company's challenges. The average Return on Capital Employed (ROCE) stands at 5.08%, which is considered modest within the construction sector. Net sales have grown at an annual rate of 7.26% over the last five years, indicating limited expansion relative to sector peers.
The company's ability to service debt is constrained, with a Debt to EBITDA ratio of -1.00 times, signalling elevated leverage concerns. Additionally, 27.62% of promoter shares are pledged, a factor that can exert additional downward pressure on the stock price during market declines.
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Recent Profitability and Valuation Metrics
Despite the stock's price decline, Sterling & Wilson Renewable Energy has reported positive results for seven consecutive quarters. The latest quarterly profit after tax (PAT) stood at Rs.106.90 crores, reflecting a growth rate of 291.5% compared to the previous four-quarter average. Net sales for the nine-month period reached Rs.6,029.34 crores, indicating higher revenue generation in the current fiscal year.
The company’s ROCE for the recent period is reported at 22.4%, which is notably higher than its long-term average, and the enterprise value to capital employed ratio is 4.8. These figures suggest an attractive valuation relative to historical levels and peer comparisons.
Over the past year, while the stock price has declined by nearly 60%, the company’s profits have risen by 510%, resulting in a price-to-earnings-to-growth (PEG) ratio of 0.1. This divergence between earnings growth and share price performance highlights a complex valuation scenario.
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Comparative Performance and Sector Positioning
In addition to the one-year underperformance, Sterling & Wilson Renewable Energy has lagged behind the BSE500 index over the last three years, one year, and three months. This sustained relative weakness contrasts with the broader construction sector, which has shown more resilience in recent periods.
The stock’s current valuation is discounted compared to its peers’ historical averages, reflecting market caution. The high proportion of pledged promoter shares remains a notable factor, as it can contribute to volatility and downward pressure during periods of market stress.
While the company has demonstrated growth in profitability and revenue, the share price movement indicates that market participants are weighing these factors against broader financial and structural considerations.
Summary of Key Metrics
The following key data points provide a snapshot of Sterling & Wilson Renewable Energy’s recent performance and financial standing:
- New 52-week low price: Rs.210.35
- Four-day consecutive decline with -9.27% returns
- Trading below all major moving averages (5, 20, 50, 100, 200 days)
- One-year stock return: -59.52% versus Sensex 4.49%
- Average ROCE: 5.08%; Recent ROCE: 22.4%
- Net sales growth over five years: 7.26% annually
- Debt to EBITDA ratio: -1.00 times
- Promoter shares pledged: 27.62%
- Latest quarterly PAT: Rs.106.90 crores, up 291.5%
- Nine-month net sales: Rs.6,029.34 crores
- Enterprise value to capital employed: 4.8
- PEG ratio: 0.1
These figures illustrate a company facing valuation and leverage challenges despite recent improvements in profitability and revenue. The stock’s movement to a 52-week low reflects the market’s current assessment of these factors within the construction sector context.
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