Tulsyan NEC Faces Financial Struggles Amid Significant Stock Decline and High Debt Levels

Tulsyan NEC, a microcap player in the Steel/Sponge Iron/Pig Iron industry, has seen significant activity today, hitting a new 52-week low of Rs. 40. The stock has underperformed its sector, which has declined by 8.2%, while Tulsyan NEC has reported a drop of 9.3% over the past two days. Currently, it is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages.
In terms of financial health, Tulsyan NEC has faced operating losses, with net sales declining at an annual rate of 7.69% over the past five years. The company's debt-to-EBITDA ratio stands at a concerning 171.78 times, indicating a low ability to service its debt. Recent quarterly results show a significant drop in profit after tax, falling to Rs. -26.96 crore, a decline of 182.8% compared to the previous four-quarter average.

The stock's performance over the past year has been particularly troubling, with a decline of 59.18%, starkly contrasting with the Sensex's drop of only 2.45%. Additionally, 99.63% of promoter shares are pledged, which could exert further downward pressure in a declining market.