Why is Zuari Industries falling/rising?
As of 26-Aug, Zuari Industries Ltd's stock price is Rs 324.05, down 3.25%, with a significant decline in delivery volume and a -14.33% return over the past year, raising concerns about its long-term viability due to weak fundamentals. Despite a recent short-term gain, the company's poor financial metrics indicate potential sustainability issues.
As of 26-Aug, Zuari Industries Ltd is experiencing a decline in its stock price, currently at Rs 324.05, which reflects a decrease of Rs 10.9 or 3.25%. The stock has been underperforming, having lost 7.12% over the last four days, and today it underperformed its sector by 1.28%. Despite trading above its moving averages, the stock's delivery volume has significantly decreased by 62.23% compared to the five-day average, indicating falling investor participation. Additionally, the stock has generated a return of -14.33% over the past year, with profits plummeting by 359.1%, which raises concerns about its long-term viability given its weak fundamentals, including a low Return on Capital Employed (ROCE) of 0.3 and a high Debt to EBITDA ratio.In the broader market context, while the Sensex has shown a slight decline of 1.05% over the past week, Zuari Industries has outperformed with a return of 11.55% in the same period. However, this short-term gain contrasts sharply with its long-term performance, where it has underperformed the market significantly over the past year. The company's weak long-term growth, evidenced by a mere 4.64% annual growth in net sales over the last five years, coupled with poor financial metrics, suggests that the recent price drop may be a reflection of investor concerns regarding its sustainability and ability to generate future profits.
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