Why is One 97 falling/rising?

Recent Price Movement and Market Performance

One 97 Communications has experienced a downward trend over the past week, with the stock falling 5.27%, significantly underperforming the Sensex, which declined by only 0.84% in the same period. Over the last month, the stock also recorded a negative return of 4.68%, contrasting with the Sensex’s modest gain of 1.02%. This short-term weakness is further highlighted by the stock’s three consecutive days of losses, amounting to a cumulative decline of 5.66%. Intraday trading on 10-Dec saw the stock touch a low of ₹1,265, down 3.84% from the previous close, with heavier volumes traded near this lower price point, indicating selling pressure.

Technical Indicators and Investor Activity

Technically, the stock’s current price remains above its 100-day and 200-day moving averages, signalling underlying long-term strength. However, it is trading below its 5-day, 20-day, and 50-day moving averages, which suggests short-term bearish momentum. Notably, investor participation has increased, with delivery volumes rising by 10.47% on 9-Dec compared to the five-day average, reflecting heightened trading activity amid the price decline. The stock maintains sufficient liquidity, supporting trade sizes of approximately ₹6.15 crore based on recent average traded values.

Strong Long-Term Fundamentals Support the Stock

Despite the recent price weakness, One 97 Communications boasts impressive long-term fundamentals. The company has delivered a compound annual growth rate (CAGR) of 20.29% in operating profits, underpinned by a healthy net sales growth rate of 21.31% annually. Its latest quarterly results, declared in September 2025, were very positive, with net sales reaching a record ₹2,061 crore and PBDIT hitting ₹141 crore, the highest to date. The operating profit margin relative to net sales also improved to 6.84%, marking a peak in operational efficiency. These strong financial metrics have contributed to consistent returns, with the stock generating 31.16% gains over the past year and outperforming the BSE500 index in each of the last three annual periods.

Institutional Confidence Remains High

Institutional investors hold a significant 71.65% stake in One 97 Communications, reflecting confidence in the company’s prospects. These investors, equipped with greater analytical resources, have increased their holdings by 0.95% over the previous quarter, signalling continued support despite recent price volatility. This institutional backing often provides a stabilising influence on the stock over the medium to long term.

Balancing Short-Term Weakness with Long-Term Strength

The recent decline in One 97 Communications’ share price appears to be driven primarily by short-term market dynamics rather than fundamental weaknesses. The stock’s underperformance relative to its sector and benchmark indices over the past week and month suggests profit-taking or cautious sentiment among traders. The increased volume near the day’s low and the stock trading below its short-term moving averages reinforce this view of near-term pressure.

However, the company’s robust quarterly performance, strong growth trajectory, and high institutional ownership provide a solid foundation for investors looking beyond immediate fluctuations. The stock’s impressive returns over one, three, and even longer-year horizons highlight its capacity to generate value over time, making it a compelling consideration for long-term portfolios despite recent volatility.

Investors should weigh the current price softness against the company’s consistent operational improvements and market position. While short-term caution is understandable given recent price action, the underlying fundamentals suggest that One 97 Communications remains well-positioned for sustained growth.

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