TCI Finance Ltd Hits Lower Circuit Amid Heavy Selling Pressure

Sharp Decline and Circuit Breaker Triggered

TCI Finance Ltd’s stock price fell by ₹0.89, hitting the maximum permissible daily loss of 5% as per the price band of ₹5. The stock traded in a range between ₹16.97 and ₹17.86, ultimately settling at the lower circuit price of ₹16.97. This marked a continuation of a steep downtrend, with the stock losing 18.49% over the past four trading sessions. The persistent fall has raised concerns among investors about the company’s near-term prospects.

Heavy Selling Pressure and Market Reaction

The total traded volume stood at 66,783 shares, with a turnover of ₹0.115 crore, indicating moderate liquidity given the company’s micro-cap status. However, delivery volumes have plummeted sharply, with only 3,290 shares delivered on 2 Feb, down 83.22% from the five-day average delivery volume. This suggests a significant drop in investor participation, possibly due to mounting uncertainty and risk aversion.

Market participants noted a surge in unfilled sell orders as panic selling intensified. The stock’s inability to recover intraday and the immediate triggering of the lower circuit reflect a lack of buying interest to absorb the supply. This imbalance between supply and demand has exacerbated the downward momentum.

Sector and Benchmark Comparison

While TCI Finance Ltd’s shares declined sharply, the broader Finance/NBFC sector gained 3.55% on the same day, highlighting the stock’s relative weakness. The Sensex and Nifty indices also posted gains of 2.56% and 2.79% respectively, underscoring that the stock’s fall was company-specific rather than market-driven.

The stock’s underperformance is further emphasised by its 1-day return of -4.98%, which lagged the sector’s 3.79% gain by 8.77 percentage points. This divergence signals deteriorating investor confidence in TCI Finance Ltd relative to its peers.

Technical and Fundamental Overview

From a technical standpoint, TCI Finance Ltd’s share price remains above its 100-day and 200-day moving averages, suggesting some long-term support. However, it is trading below its 5-day, 20-day, and 50-day moving averages, indicating short- to medium-term weakness and bearish momentum. This mixed technical picture reflects the stock’s struggle to regain investor confidence amid recent volatility.

Fundamentally, the company’s micro-cap market capitalisation of ₹23 crore places it in a highly speculative category, often prone to sharp price swings and liquidity constraints. The company’s Mojo Score currently stands at 33.0, with a Mojo Grade of Sell, downgraded from Strong Sell on 30 Dec 2025. This downgrade reflects a deteriorating outlook based on financial metrics, quality grades, and trend assessments.

Investor Sentiment and Outlook

Investor sentiment towards TCI Finance Ltd has soured considerably, as evidenced by the sustained selling pressure and the stock’s failure to attract buyers at lower levels. The sharp fall and circuit hit have likely triggered stop-loss orders and margin calls, further intensifying the sell-off. The lack of fresh positive triggers or corporate developments has left the stock vulnerable to continued downside risk.

Given the stock’s underperformance relative to its sector and the broader market, investors are advised to exercise caution. The current liquidity profile, while adequate for small trades, may not support large volume transactions without significant price impact. This could lead to further volatility in the near term.

Conclusion: Navigating the Risks Ahead

TCI Finance Ltd’s recent plunge to the lower circuit limit underscores the challenges faced by micro-cap NBFCs in maintaining investor confidence amid volatile market conditions. The stock’s sustained decline, heavy selling pressure, and falling delivery volumes highlight a precarious situation that warrants close monitoring.

Investors should weigh the risks of continued downside against any potential recovery catalysts. Given the company’s current Mojo Grade of Sell and deteriorating trend, a cautious approach is advisable until clearer signs of stabilisation emerge. Monitoring sector trends and broader market movements will also be crucial in assessing the stock’s future trajectory.

For those seeking alternatives, evaluating other NBFCs or sectors with stronger fundamentals and momentum may offer better risk-adjusted opportunities in the current market environment.

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