Recent Price Movement and Market Context
TVS Supply Chain Solutions recorded its lowest price in the past year at Rs.103, a level not seen before in its trading history. This new low comes after the stock experienced a consecutive five-day decline, resulting in a cumulative return of -5.61% during this period. The stock’s performance today underperformed its sector by 0.84%, indicating relative weakness within the transport services industry.
Notably, the stock is 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 downward momentum in the short to medium term.
In contrast, the broader market index, Sensex, opened flat but later declined by 231.68 points, or 0.37%, closing at 85,393.16. Despite this dip, Sensex remains close to its 52-week high of 86,159.02, trading just 0.9% below that peak. The index is supported by bullish moving averages, with the 50-day moving average positioned above the 200-day moving average, signalling overall market resilience.
Long-Term Performance and Comparative Analysis
Over the past year, TVS Supply Chain Solutions has delivered a return of -42.68%, a stark contrast to the Sensex’s positive return of 4.52% during the same period. The stock’s 52-week high was Rs.196.55, highlighting the extent of the decline from its peak.
Further comparison with the BSE500 index reveals that the stock has underperformed not only in the last year but also over the past three years and three months. This extended period of relative underperformance underscores challenges faced by the company in maintaining competitive growth and shareholder value.
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Financial Metrics and Profitability Indicators
Analysis of the company’s financial health reveals a compound annual growth rate (CAGR) of operating profits at -1.29% over the last five years, indicating a contraction in core earnings. The average EBIT to interest coverage ratio stands at 0.84, reflecting limited capacity to comfortably service debt obligations.
Return on Equity (ROE) averages at 3.86%, signalling modest profitability relative to shareholders’ funds. This level of ROE suggests that the company has generated limited returns on invested equity capital over time.
Additionally, promoter shareholding includes 29.23% of pledged shares. In declining market conditions, a high proportion of pledged shares can exert additional downward pressure on stock prices, as these shares may be subject to liquidation in adverse scenarios.
Recent Operational and Valuation Highlights
Despite the stock’s price challenges, certain operational metrics have shown positive trends. The company reported its highest annual operating cash flow at Rs.524.20 crores in the latest financial year. Return on Capital Employed (ROCE) for the half-year period reached 8.72%, the highest recorded in recent times, while the debt-to-equity ratio improved to 1.14 times, indicating a relatively lower leverage position.
Valuation metrics also present an interesting picture. The company’s ROCE of 4.3 and an enterprise value to capital employed ratio of 1.8 suggest that the stock is trading at a discount relative to its peers’ historical valuations. Over the past year, profits have increased by 302%, even as the stock price declined by 42.68%, resulting in a price-to-earnings-growth (PEG) ratio of 0.1.
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Sectoral and Market Considerations
TVS Supply Chain Solutions operates within the transport services sector, which has faced mixed market conditions recently. While the broader Sensex index maintains a position near its 52-week high, the transport services sector has experienced relative softness, contributing to the stock’s underperformance.
The stock’s market capitalisation grade is rated at 3, reflecting its mid-tier position within the market capitalisation spectrum. This positioning may influence liquidity and investor attention compared to larger-cap peers.
Day-to-day price changes show a decline of 1.00% today, continuing the trend of recent losses. The stock’s performance relative to sector peers and broader indices highlights the challenges faced in regaining momentum.
Summary of Key Price and Performance Data
To summarise, TVS Supply Chain Solutions has reached a new 52-week low of Rs.103, down from its 52-week high of Rs.196.55. The stock has recorded a one-year return of -42.68%, contrasting with the Sensex’s positive 4.52% return over the same period. The recent five-day consecutive decline has resulted in a cumulative loss of 5.61%, with the stock trading below all major moving averages.
Financial indicators point to subdued growth in operating profits over five years, limited debt servicing capacity, and modest returns on equity. However, recent cash flow and ROCE figures show some improvement, alongside a valuation discount relative to peers.
Promoter share pledging remains a factor to consider given its potential impact on stock price dynamics in falling markets.
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