Recent Price Movement and Market Context
The stock has been on a downward trajectory for the past two days, registering a cumulative loss of 0.99% during this period. Today’s closing price of Rs.5.55 represents the lowest level the share has traded at in the last year, down sharply from its 52-week high of Rs.11. This decline comes despite a day where the broader Sensex initially opened 323.83 points higher but reversed sharply to close 395.64 points lower at 75,431.04, reflecting a cautious market environment. The Sensex itself is trading below its 50-day moving average, which in turn is below the 200-day moving average, signalling a bearish trend in the broader market.
Super Tannery’s underperformance is further highlighted by its relative returns over the past year. While the Sensex has delivered a modest gain of 1.70%, the company’s stock has declined by 35.78%, significantly lagging the benchmark. Additionally, the stock has underperformed its sector, falling 1.04% more than the diversified consumer products sector on the day.
The share price is currently trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring the prevailing negative momentum in the stock’s price action.
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Financial Performance and Fundamental Metrics
Super Tannery’s financial indicators reflect a challenging environment. The company’s net sales for the December 2025 quarter stood at Rs.59.87 crores, marking the lowest quarterly sales figure in recent periods. Over the last five years, net sales have grown at a modest annual rate of 8.11%, while operating profit has increased at a rate of 15.08%. These growth rates, while positive, are relatively subdued compared to sector averages.
The company’s return on capital employed (ROCE) averages 7.13%, indicating limited efficiency in generating returns from its capital base. This figure is below levels typically associated with stronger fundamental health in the diversified consumer products sector. The debt servicing capacity also remains a concern, with a high Debt to EBITDA ratio of 3.39 times, suggesting elevated leverage and potential pressure on cash flows.
Despite these challenges, the company’s valuation metrics present a contrasting picture. With a ROCE of 8.3 and an enterprise value to capital employed ratio of 0.7, Super Tannery is trading at a discount relative to its peers’ historical valuations. This valuation gap reflects the market’s cautious stance on the stock amid its recent performance.
Profitability has shown slight improvement, with profits rising by 1.4% over the past year. However, the price-to-earnings-to-growth (PEG) ratio stands at 6.4, indicating that the stock price has not kept pace with earnings growth, which may be a factor in the current valuation levels.
Technical Indicators and Market Sentiment
Technical analysis presents a mixed outlook. On a weekly basis, the Moving Average Convergence Divergence (MACD) indicator is mildly bullish, while the monthly MACD remains bearish. The Relative Strength Index (RSI) shows no clear signal weekly but is bullish on a monthly timeframe. Bollinger Bands indicate bearish trends on both weekly and monthly charts. Daily moving averages are firmly bearish, reinforcing the downward price momentum.
The KST (Know Sure Thing) indicator is mildly bullish weekly but bearish monthly, and Dow Theory analysis shows no clear trend weekly with a mildly bullish stance monthly. These mixed signals suggest that while short-term technical factors may offer some support, the broader trend remains subdued.
Shareholding and Market Capitalisation
Super Tannery is classified as a micro-cap stock, with promoters holding the majority stake. This concentrated ownership structure can influence stock liquidity and price movements. The company’s Mojo Score currently stands at 31.0, with a Mojo Grade of Sell, an upgrade from a previous Strong Sell rating as of 27 March 2025. This reflects a slight improvement in the company’s overall assessment but still indicates a cautious stance.
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Summary of Key Concerns
The stock’s decline to Rs.5.55 reflects a combination of factors including subdued sales growth, limited return on capital, and elevated leverage. The company’s inability to keep pace with broader market gains and sector performance has contributed to its underwhelming share price trajectory. Technical indicators largely support the current downtrend, with the stock trading below all major moving averages and exhibiting bearish momentum on multiple timeframes.
While valuation metrics suggest the stock is trading at a discount relative to peers, this is tempered by the company’s modest profit growth and high PEG ratio. The micro-cap status and promoter majority ownership add further layers of complexity to the stock’s market behaviour.
Market Environment
The broader market environment has been volatile, with the Sensex showing a sharp reversal after a positive start to the day. The index’s position below key moving averages signals a cautious market mood, which has likely influenced sentiment towards stocks like Super Tannery.
Investors and market participants will continue to monitor the stock’s price action and fundamental developments closely as it navigates this challenging phase.
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