Why is Geojit Fin. Ser. falling/rising?

Recent Price Movement and Market Performance

On 24 November, Geojit Financial Services closed at ₹71.01, down ₹1.65 or 2.27% from the previous session. This decline continues a three-day losing streak during which the stock has fallen by 5.82%. Intraday trading saw the share touch a low of ₹70.80, marking a 2.56% drop. The weighted average price indicates that a significant volume of shares exchanged hands near this lower price point, signalling selling pressure. Furthermore, the stock is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, underscoring a bearish technical trend.

Underperformance Against Benchmarks

Geojit Financial Services has substantially underperformed the benchmark indices over multiple time horizons. Over the past week, the stock declined by 6.11%, while the Sensex remained virtually flat with a marginal 0.06% gain. The one-month performance shows a 3.20% loss for the stock compared to a 0.82% rise in the Sensex. More strikingly, the year-to-date and one-year returns for Geojit stand at -38.04% and -40.33% respectively, in stark contrast to the Sensex’s positive returns of 8.65% and 7.31% over the same periods. This persistent underperformance highlights investor concerns about the company’s fundamentals and growth prospects.

Fundamental Challenges and Financial Performance

Despite a strong long-term fundamental strength indicated by an average Return on Equity (ROE) of 17.31%, recent financial results have been disappointing. The company’s operating profit has grown at a modest annual rate of 6.64%, which is insufficient to inspire confidence among investors. More concerning is the decline in net sales by 5.67%, which contributed to very negative quarterly results declared in September 2025. The company has reported negative results for three consecutive quarters, with quarterly PBDIT at a low of ₹38.94 crore, PBT excluding other income at ₹27.17 crore, and PAT at ₹22.37 crore, all reflecting a weakening profitability trend.

Investor Sentiment and Institutional Participation

Investor participation has also waned, with delivery volumes on 21 November falling by 42.69% compared to the five-day average, signalling reduced buying interest. Institutional investors, who typically possess greater analytical resources, have decreased their stake by 0.58% in the previous quarter and now collectively hold only 3.79% of the company’s shares. This decline in institutional ownership often signals diminished confidence in the company’s near-term prospects and can exacerbate downward pressure on the stock price.

Valuation and Market Context

While the stock trades at an attractive valuation with a price-to-book ratio of 1.7, which is discounted relative to its peers’ historical averages, this valuation advantage has not translated into positive returns. Over the past year, the stock’s price has fallen by 40.33%, closely mirroring a 37.7% decline in profits. This correlation suggests that the market is pricing in the company’s deteriorating earnings outlook rather than any potential recovery.

Conclusion: Why the Stock Is Falling

In summary, the decline in Geojit Financial Services’ share price as of 24 November is primarily driven by a combination of weak quarterly financial results, declining sales, and profitability pressures. The company’s inability to deliver positive earnings growth over recent quarters has eroded investor confidence. This is compounded by falling institutional participation and a technical downtrend reflected in the stock trading below all major moving averages. Despite a reasonable valuation and strong long-term ROE, the market remains cautious due to the company’s poor recent performance and underwhelming growth prospects. Consequently, the stock has underperformed both its sector and broader market indices, leading to sustained selling pressure and a notable decline in its share price.

Get 2 full years of MojoOne Premium for only Rs. 12,999. Subscribe for 1 year and we'll add another year FREE. Offer valid for a limited time. Start Saving Now →