Why is Nidhi Granites Ltd falling/rising?

Recent Price Movement and Market Context

Despite a mixed short-term performance, with the stock declining 4.76% over the past week and 3.80% in the last month, Nidhi Granites has demonstrated remarkable resilience over longer horizons. Year-to-date, the stock is down by 2.44%, slightly outperforming the Sensex's 4.17% decline. However, the standout feature remains its extraordinary one-year return of 182.57%, vastly eclipsing the Sensex's modest 5.37% gain. Over three and five years, the stock has delivered staggering returns of 877.35% and 2363.87% respectively, underscoring its status as a high-growth investment within its sector.

On the day in question, the stock outperformed its sector by 1.31%, opening with a gap up of 4.88% and reaching an intraday high of ₹392. This positive momentum follows two consecutive days of gains, during which the stock appreciated by 6.57%. Such price action indicates renewed buying interest, despite a notable decline in delivery volume by 84.39% compared to the five-day average, suggesting that the recent rally may be driven by selective investor participation rather than broad-based enthusiasm.

Financial Strength and Growth Drivers

Nidhi Granites' recent price appreciation is underpinned by its solid financial health and impressive growth trajectory. The company maintains a low average debt-to-equity ratio of 0.05 times, signalling prudent capital management and limited financial risk. This conservative leverage profile is attractive to investors seeking stability alongside growth.

Operationally, the company has exhibited robust expansion, with net sales growing at an annualised rate of 175.82% and operating profit increasing by 55.32%. These figures highlight the firm’s ability to scale its business efficiently while maintaining profitability.

Further bolstering investor sentiment are the positive results reported for the six months ending September 2025. Net sales reached ₹32.99 crores, marking a 54.30% increase compared to prior periods. Profit before tax excluding other income (PBT less OI) for the latest quarter stood at ₹1.76 crores, reflecting a remarkable 134.7% growth relative to the average of the preceding four quarters. Additionally, the company’s profit after tax (PAT) for the six-month period rose to ₹3.53 crores, reinforcing the narrative of sustained earnings improvement.

Consistent Outperformance and Investor Confidence

Over the past three years, Nidhi Granites has consistently outperformed the broader BSE500 index, delivering superior returns in each annual period. This track record of outperformance has likely contributed to the stock’s strong appeal among investors seeking growth opportunities in the miscellaneous microcap segment.

Technically, the stock trades above its 5-day and 200-day moving averages, indicating short-term and long-term support levels, although it remains below the 20-day, 50-day, and 100-day averages. This mixed technical picture suggests that while momentum is positive, some resistance levels remain to be tested in the near term.

Conclusion: Why the Stock is Rising

The recent rise in Nidhi Granites Ltd’s share price is primarily driven by its strong fundamental performance, highlighted by exceptional sales and profit growth, a conservative debt profile, and consistent long-term returns that far exceed market benchmarks. The positive quarterly results released in September 2025 have reinforced investor confidence, prompting a short-term rally despite some volatility in trading volumes. While the stock has experienced some short-term pullbacks, its overall trajectory remains upward, supported by solid operational metrics and a history of outperforming the broader market indices.

Investors looking for growth in the microcap space may find Nidhi Granites’ combination of financial discipline and rapid expansion compelling, although attention to technical resistance levels and trading liquidity is advisable for timing entries and exits.

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 →