Z F Steering Gear (India) Falls to 52-Week Low of Rs.804.6 Amidst Market Pressure

Stock Price Movement and Market Context

On 21 Nov 2025, Z F Steering Gear (India) touched an intraday low of Rs.804.6, representing a 3% decline during the trading session. This new low follows four consecutive days of price falls, although the stock showed some recovery by gaining marginally on the day, outperforming its sector by 0.76%. Despite this slight uptick, the stock remains below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained downward momentum.

In contrast, the Sensex opened lower at 85,347.40, down by 285.28 points or 0.33%, and was trading at 85,416.66 at the time of reporting, a 0.25% decline. The Sensex remains close to its 52-week high of 85,801.70, trading above its 50-day and 200-day moving averages, indicating a generally bullish trend in the broader market. This divergence highlights the relative underperformance of Z F Steering Gear (India) within the auto components sector.

Financial Performance and Profitability Indicators

Over the past year, Z F Steering Gear (India) has recorded a stock price decline of 44.93%, significantly underperforming the Sensex, which has shown a positive return of 10.71% over the same period. The stock’s 52-week high was Rs.1,635, underscoring the extent of the price contraction.

The company’s financial metrics reveal areas of concern. The Return on Capital Employed (ROCE) stands at 3.76%, indicating limited profitability relative to the capital invested. This figure is notably low for the auto components industry, where efficient capital utilisation is critical for sustainable growth.

Operating profit trends over the last five years show a compound annual decline of 28.65%, reflecting challenges in maintaining earnings growth. Additionally, the company has reported negative results for five consecutive quarters, with the Profit Before Tax excluding other income (PBT less OI) at Rs. -0.85 crore for the latest quarter, a decline of 211.5% compared to the previous four-quarter average. The net profit after tax (PAT) for the quarter was Rs. -0.39 crore, down by 112.3% relative to the prior four-quarter average.

Debt and Valuation Metrics

Despite the pressures on profitability, Z F Steering Gear (India) maintains a relatively manageable debt profile. The company’s Debt to EBITDA ratio is 1.27 times, suggesting a capacity to service its debt obligations without excessive strain. This ratio is a positive indicator in the context of the company’s financial health.

The valuation metrics also indicate that the stock is trading at a discount relative to its peers. The Enterprise Value to Capital Employed ratio stands at 1.5, with a ROCE of 1.7, suggesting a fair valuation in comparison to industry averages. However, this discount has coincided with a 66.3% decline in profits over the past year, reflecting the broader challenges faced by the company.

Shareholding and Market Participation

Domestic mutual funds hold no stake in Z F Steering Gear (India), a notable point given their capacity for detailed company research and due diligence. This absence of institutional investment may reflect a cautious stance towards the company’s current valuation and business outlook.

In comparison, the BSE500 index has generated returns of 9.02% over the last year, further emphasising the stock’s underperformance within the broader market context.

Summary of Key Performance Indicators

Z F Steering Gear (India) has experienced a notable decline in stock price, reaching Rs.804.6 as its 52-week low. The company’s financial indicators point to subdued profitability, with a low ROCE and a significant reduction in operating profit over recent years. Quarterly results have remained in negative territory for five consecutive periods, with both PBT and PAT showing declines relative to previous averages.

While the company’s debt servicing ability remains adequate, and valuation metrics suggest a discount compared to peers, the overall performance has lagged behind the broader market and sector indices. The absence of domestic mutual fund holdings further highlights the cautious market stance on this stock.

These factors collectively illustrate the challenges faced by Z F Steering Gear (India) as it navigates a difficult market environment and attempts to stabilise its financial position.

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