Recent Price Movement and Market Comparison
The stock has been under pressure for several weeks, registering a 4.05% decline over the past week and a steep 15.05% drop in the last month. This contrasts sharply with the Sensex, which gained 0.63% and 2.27% respectively over the same periods. Year-to-date, Epack Durable’s shares have plummeted by nearly 54%, while the Sensex has risen by 8.91%. Over the last year, the stock has lost 41.10%, whereas the benchmark index advanced by 4.15%. These figures highlight the stock’s persistent underperformance against broader market indices.
On 08-Dec, the stock hit a new 52-week low of ₹250.65, marking a significant intraday decline of 3.04%. It has now fallen for three consecutive days, losing 7.02% in that span. The share price is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a bearish technical outlook. Additionally, investor participation appears to be waning, with delivery volumes on 05-Dec dropping by 47.26% compared to the five-day average, suggesting reduced buying interest.
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Fundamental Challenges Weighing on the Stock
Despite an attractive valuation indicated by a Return on Capital Employed (ROCE) of 6.1% and an enterprise value to capital employed ratio of 1.9, the company’s fundamentals remain weak. The stock trades at a discount relative to its peers’ historical valuations, yet this has not translated into positive price momentum. Over the past year, while profits have increased by 60%, the stock’s price has declined sharply, reflecting investor concerns about the company’s broader financial health.
Institutional investors have marginally increased their stake by 1.43% in the previous quarter, now holding 7.39% of the company. This suggests some confidence from well-resourced investors who typically conduct thorough fundamental analysis. However, this has not been sufficient to arrest the stock’s decline amid deteriorating financial results.
Severe Earnings Decline and Debt Burden
The company reported very negative results in September 2025, with net sales plunging by 67.8%. This followed two consecutive quarters of losses, signalling ongoing operational difficulties. Profit before tax excluding other income fell dramatically by 364.2% to a loss of ₹34.84 crores compared to the previous four-quarter average. Net profit after tax also declined sharply by 262.9% to a loss of ₹22.25 crores. Meanwhile, interest expenses rose by 27.63% to ₹20.23 crores, exacerbating the company’s financial strain.
These figures underscore the company’s weak ability to service debt, reflected in a high Debt to EBITDA ratio of 4.51 times. The average ROCE of 6.14% further indicates limited efficiency in generating returns from capital employed, which is a concern for long-term investors.
The stock’s poor performance is also evident in its underperformance relative to the BSE500 index over multiple time frames, including the last three years, one year, and three months. This sustained weakness highlights the challenges Epack Durable faces in regaining investor confidence and market share.
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Conclusion: Why the Stock Is Falling
Epack Durable’s share price decline on 08-Dec and over recent weeks is primarily driven by its deteriorating financial performance, including significant losses, declining sales, and rising interest costs. The company’s inability to generate adequate returns on capital and service its debt has eroded investor confidence. This is compounded by the stock’s consistent underperformance relative to major indices and peers, as well as technical indicators signalling bearish momentum. Although institutional investors have marginally increased their holdings, this has not offset the negative sentiment stemming from weak quarterly results and poor long-term fundamentals.
Investors should carefully weigh these factors before considering exposure to Epack Durable, as the current market environment reflects substantial risks associated with the company’s financial health and operational outlook.
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