Why is Thomas Cook (India) Ltd falling/rising?

Recent Price Movement and Market Comparison

Thomas Cook (India) Ltd’s shares have been under pressure over multiple time frames. In the past week, the stock fell by 2.15%, while the Sensex remained nearly flat with a marginal gain of 0.02%. Over the last month, the divergence widened further as the stock declined by 11.77%, contrasting with the Sensex’s 2.15% rise. Year-to-date, the stock has plummeted by 26.48%, significantly underperforming the benchmark’s modest 2.26% loss. Even on a one-year horizon, the stock has generated a negative return of 17.65%, whereas the Sensex has appreciated by 10.60%. This persistent underperformance highlights investor concerns about the company’s near-term prospects.

Technical Indicators and Trading Activity

Technically, the stock is trading below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a bearish trend. The share price is also hovering close to its 52-week low, just 0.82% above the lowest level of ₹108.50, underscoring the stock’s weak momentum. Despite this, there has been a notable increase in investor participation, with delivery volumes on 20 Feb rising by over 105% compared to the five-day average. This heightened activity suggests that some investors may be positioning for a potential turnaround, although the overall sentiment remains cautious.

Fundamental Strengths Amidst Weak Price Performance

Despite the recent price weakness, Thomas Cook (India) Ltd exhibits several positive fundamental attributes. The company maintains a zero average debt-to-equity ratio, indicating a clean balance sheet with no reliance on debt financing. Its net sales have grown at an impressive annual rate of 41.27%, while operating profit has expanded by 21.12%, reflecting healthy long-term growth. The return on equity (ROE) stands at a respectable 10.2%, and the stock trades at a price-to-book value of 2.2, which is considered attractive relative to its peers’ historical valuations. Furthermore, profits have increased by 1.7% over the past year, although this has not translated into share price gains.

Institutional investors have shown increased confidence by raising their stake by 1.45% in the previous quarter, now collectively holding 14.22% of the company. This growing institutional participation often signals a belief in the company’s underlying fundamentals, as these investors typically possess greater analytical resources than retail participants.

Challenges Weighing on the Stock

However, the company’s recent quarterly results have disappointed the market. The earnings per share (EPS) for the quarter ended December 2025 was a low ₹0.89, marking the lowest level in recent periods. Additionally, non-operating income accounted for a substantial 45.61% of profit before tax, suggesting that core business profitability remains subdued. This reliance on non-operating income raises concerns about the sustainability of earnings growth.

Moreover, the stock’s underperformance relative to the broader market is stark. While the BSE500 index has delivered a 13.16% return over the last year, Thomas Cook (India) Ltd’s shares have declined by 17.65%, indicating a significant divergence that may reflect investor scepticism about the company’s near-term outlook and competitive positioning.

Conclusion: Why the Stock is Falling

In summary, Thomas Cook (India) Ltd’s share price decline as of 23-Feb is primarily driven by its sustained underperformance against market benchmarks, disappointing quarterly earnings marked by low EPS and a high proportion of non-operating income, and technical weakness reflected in trading below all major moving averages. While the company’s long-term growth metrics and low debt profile remain positive factors, these have not been sufficient to offset concerns about near-term profitability and market sentiment. The stock’s proximity to its 52-week low and continued negative returns year-to-date suggest that investors remain cautious, awaiting clearer signs of operational improvement before committing further capital.

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 →