Recent Price Movement and Trading Activity
The stock recorded an intraday low of Rs.238, representing a 4.8% drop on the day. This decline extends a losing streak over the past two trading sessions, during which Suraj Ltd’s share price has fallen by 4.99%. Notably, the stock has underperformed its sector by 4.88% today, reflecting a weaker relative performance within the Iron & Steel Products industry. Trading activity has been somewhat erratic, with the stock not trading on one of the last 20 trading days, adding to the volatility concerns.
Suraj Ltd is currently trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a sustained bearish trend. This technical positioning suggests that the stock has struggled to gain upward momentum over multiple time horizons.
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Comparative Market Context
While Suraj Ltd’s stock has been declining, the broader market has shown resilience. The Sensex opened flat but gained 0.12% to trade at 85,321.82 points, remaining just 0.98% below its 52-week high of 86,159.02. The Sensex is trading above its 50-day moving average, which itself is positioned above the 200-day moving average, indicating a bullish market trend. Mega-cap stocks have been leading the gains, contrasting with Suraj Ltd’s underperformance.
Over the past year, Suraj Ltd’s stock has delivered a negative return of 54.14%, starkly underperforming the Sensex’s positive 8.68% return and the BSE500’s 6.04% gain. This divergence highlights the stock’s relative weakness within the Indian equity market.
Financial Performance and Valuation Metrics
Suraj Ltd’s financial results have been disappointing, contributing to the stock’s decline. The company reported a fall in net sales by 11.39% in the September 2025 quarter, marking the third consecutive quarter of negative results. Operating profit has contracted at an annual rate of 1.03% over the last five years, reflecting subdued growth in core earnings.
Operating cash flow for the year has reached a low of Rs. -9.01 crores, indicating cash generation difficulties. Interest expenses for the nine months ended have increased by 49.82% to Rs.4.06 crores, adding pressure on profitability. Profit before tax excluding other income for the quarter has plummeted by 96.53% to Rs.0.24 crores, underscoring the earnings strain.
The company’s return on capital employed (ROCE) stands at 4.5%, which, combined with an enterprise value to capital employed ratio of 2.8, suggests an expensive valuation relative to the returns generated. Despite this, the stock is trading at a discount compared to its peers’ average historical valuations, reflecting market concerns about its prospects.
Shareholding and Market Grade
Promoters remain the majority shareholders of Suraj Ltd, maintaining significant control over the company’s direction. The stock’s Mojo Score has deteriorated to 20.0, with a Mojo Grade of Strong Sell as of 4 April 2025, downgraded from a previous Sell rating. The market capitalisation grade is rated at 4, indicating a mid-cap status with associated liquidity and volatility characteristics.
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Historical Price Performance
Suraj Ltd’s 52-week high was Rs.522, reached within the last year, indicating a significant decline of over 54% to the current low of Rs.238. This steep drop reflects the cumulative impact of weak financial results, rising costs, and subdued investor sentiment. The stock’s performance contrasts sharply with the broader market’s upward trajectory, highlighting sector-specific and company-specific pressures.
Despite the discount to peer valuations, the company’s financial metrics and recent earnings trends have weighed heavily on the stock price, contributing to the current valuation levels.
Summary of Key Concerns
The combination of declining sales, shrinking profits, increased interest expenses, and negative cash flows has created a challenging environment for Suraj Ltd. The stock’s technical indicators confirm a sustained downtrend, with prices below all major moving averages. The downgrade to a Strong Sell rating by MarketsMOJO further reflects the cautious stance on the stock’s near-term outlook.
While the broader market and sector indices have shown resilience, Suraj Ltd’s performance has lagged considerably, underscoring the company-specific factors driving the stock to its 52-week low.
Conclusion
Suraj Ltd’s stock reaching Rs.238 marks a significant milestone in its recent price decline, reflecting ongoing financial pressures and market challenges. The stock’s underperformance relative to the Sensex and sector peers, combined with deteriorating financial metrics and a Strong Sell Mojo Grade, paints a picture of continued caution around this Iron & Steel Products company.
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