Why is DCM Shriram Inds falling/rising?

Sep 17 2025 10:39 PM IST
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As of 17-Sep, DCM Shriram Industries Ltd's stock price is at 170.25, reflecting a 3.62% increase. Despite a year-to-date decline, recent upward movement is supported by attractive valuation and increased institutional investor participation, although challenges like high debt and low growth may affect long-term performance.
As of 17-Sep, DCM Shriram Industries Ltd's stock price is rising, currently at 170.25, reflecting an increase of 5.95 or 3.62%. Today's price summary indicates that the stock has outperformed its sector by 3.46% and has experienced a trend reversal, gaining after two consecutive days of decline. The stock reached an intraday high of Rs 174.55, and while it is trading above its 5-day, 20-day, and 50-day moving averages, it remains below its 100-day and 200-day moving averages. Despite a year-to-date decline of 7.32% and a one-year return of -12.24%, the stock's attractive valuation, indicated by a return on capital employed (ROCE) of 11.9 and a lower trading price compared to peers, may be contributing to the recent upward movement. Additionally, there has been an increase in institutional investor participation, with a 0.88% rise in their stake, suggesting a positive outlook from more knowledgeable investors.

In the broader market context, the stock's short-term performance over the past week shows a decline of 1.05%, while the benchmark Sensex has risen by 1.56%. This underperformance in the short term contrasts with the stock's positive return of 4.22% over the past month, compared to the Sensex's 2.60% increase. The recent rise in the stock price may be influenced by the increasing participation of institutional investors, who typically have better resources to analyze the company's fundamentals. However, the company faces challenges such as a high Debt to EBITDA ratio of 2.72 times and a low growth rate in net sales and operating profit over the last five years, which could impact its long-term performance and investor sentiment.
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