Why is Seshasayee Paper falling/rising?

Jul 10 2025 09:43 PM IST
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As of 10-Jul, Seshasayee Paper & Boards Ltd's stock price is declining at 300.20, down 1.27%, with significant drops in investor participation and negative financial results over the past seven quarters. Despite a recent modest gain, long-term growth prospects are poor, and the stock is trading at a premium with low returns on equity and capital employed.
As of 10-Jul, Seshasayee Paper & Boards Ltd is experiencing a decline in its stock price, currently at 300.20, which reflects a decrease of 3.85 or 1.27%. Today's price summary indicates that the stock's performance is in line with the sector, although it is trading higher than the 20, 50, 100, and 200-day moving averages but lower than the 5-day moving average. Notably, there has been a significant drop in investor participation, with delivery volume falling by 65.33% compared to the 5-day average. Over the past week, the stock has shown a modest gain of 1.35%, but it has underperformed over the longer term, with a year-to-date return of -2.01% and a one-year return of -14.31%. The company's financial health is concerning, as it has reported negative results for the last seven consecutive quarters, with a drastic decline in both profit before tax and profit after tax.

Broader market context shows that while the Sensex has generated a return of 0.97% over the past month, Seshasayee Paper has outperformed the benchmark with a 5.00% return in the same period. However, the stock's long-term growth prospects appear poor, with an annual operating profit decline of 22.19% over the last five years and a low return on capital employed (ROCE) of 6.81%. The stock is also trading at a premium compared to its peers, which raises concerns about its valuation given its low return on equity (ROE) of 5.5. Despite high institutional holdings at 27.42%, which typically indicate a level of confidence from more knowledgeable investors, the overall sentiment remains negative due to the company's ongoing financial struggles and underperformance relative to the broader market.
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