RENUKA - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 2.9

📊 Long-Term Investment Analysis

Shree Renuka Sugars (RENUKA) presents a high-risk, speculative opportunity rather than a stable long-term investment. While the company has shown moments of turnaround, its fundamentals remain weak.

✅ Positives

ROCE: Decent at 10.5%, indicating operational efficiency.

Promoter Holding: Strong at 62.48%, suggesting long-term commitment.

Quarterly Turnaround: PAT improved from a loss of ₹204 Cr to a profit of ₹91.6 Cr

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Low RSI (37.3): Indicates potential for technical rebound.

⚠️ Concerns

Negative Book Value: ₹-7.87, implying accumulated losses and weak balance sheet

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EPS: Negative at ₹-1.41, showing consistent losses

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No Dividend: 0% yield, not rewarding shareholders.

PEG & P/E: Not meaningful due to negative earnings.

Debt-to-Equity: Not disclosed, but historical data suggests high leverage

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Volatile Performance: 1-year return of -42%, 3-year of -15.1%

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💰 Ideal Entry Price Zone

Given the speculative nature and technical levels

Current Price: ₹30.7

52-week Low: ₹24.7

DMA 50/200: ₹32 / ₹34.9

Suggested Entry Zone: ₹25–₹28 This range offers a better risk-reward ratio near support levels and aligns with technical stop-loss zones

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🧭 Exit Strategy & Holding Period

📈 Holding Strategy

Time Horizon: 1–2 years max, unless fundamentals improve.

Forecasted Targets

2026: ₹50–₹52

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2030: ₹49–₹57

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🚪 Exit Strategy

Exit on Strength: Consider exiting if price reaches ₹45–₹50 in the next 1–2 years.

Stop-Loss: ₹24.5, below which downside risk increases sharply

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Re-evaluate: If EPS remains negative and ROE doesn’t improve, exit regardless of price.

🧠 Final Thought

RENUKA is not ideal for conservative long-term investors. It may suit short-term traders or aggressive investors betting on ethanol policy tailwinds or turnaround stories. For more stable sugar sector picks, consider Balrampur Chini or Dalmia Bharat Sugar, which have stronger ROE, dividend, and earnings profiles

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Would you like a comparison table of sugar stocks to help decide where to invest instead?

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www.screener.in

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www.valueresearchonline.com

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stockpricearchive.com

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walletinvestor.com

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