Net Profit (Q3 FY26)
₹2.95 Cr
▲ 56.90% QoQ
Revenue (Q3 FY26)
₹89.80 Cr
▲ 38.41% YoY
Operating Margin
6.06%
Best in 7 Quarters
Return on Equity
6.47%
Latest FY
The third quarter marked a seasonal peak for Teesta Agro, with revenue hitting a seven-quarter high of ₹89.80 crores, representing a 34.86% increase from Q2 FY26 and a 38.41% jump from Q3 FY25. This strong top-line performance translated into improved profitability metrics, with operating margins expanding to 6.06% from 3.48% in the previous quarter. However, investors remain cautious, as evidenced by the stock’s bearish technical trfinish and its position below all major relocating averages.
The company’s proprietary Mojo Score stands at 47 out of 100, placing it firmly in “SELL” territory. This rating reflects a confluence of factors: attractive valuation at a price-to-earnings ratio of 8.05x, but offset by weak long-term fundamentals with an average return on equity of just 5.34% and a bearish technical outview. The micro-cap fertiliser manufacturer faces the challenge of converting seasonal strength into sustained performance.
| Quarter | Net Sales (₹ Cr) | QoQ Growth | Net Profit (₹ Cr) | QoQ Growth | PAT Margin |
|---|---|---|---|---|---|
| Dec’25 | 89.80 | +34.86% | 2.95 | +56.90% | 3.29% |
| Sep’25 | 66.59 | +78.86% | 1.22 | +31.18% | 1.83% |
| Jun’25 | 37.23 | -5.60% | 0.93 | -74.93% | 2.50% |
| Mar’25 | 39.44 | -39.21% | 3.71 | +97.34% | 9.41% |
| Dec’24 | 64.88 | +21.82% | 1.88 | +164.79% | 2.90% |
| Sep’24 | 53.26 | +76.77% | 0.71 | +44.90% | 1.33% |
| Jun’24 | 30.13 | — | 0.49 | — | 1.63% |
Financial Performance: Seasonal Strength Drives Q3 Surge
Teesta Agro’s Q3 FY26 performance displaycased the seasonal nature of the fertiliser business, with revenue climbing to ₹89.80 crores from ₹66.59 crores in Q2 FY26, marking the highest quarterly sales in at least seven quarters. The 34.86% sequential growth reflected robust demand during the peak agricultural season, whilst the 38.41% year-on-year increase demonstrated market share gains or pricing improvements compared to the prior year period.
Profitability metrics improved substantially during the quarter. Net profit of ₹2.95 crores represented a 56.90% quarter-on-quarter jump, translating to a profit after tax margin of 3.29%, up from 1.83% in Q2 FY26. Operating margins expanded to 6.06% from 3.48% in the previous quarter, suggesting better absorption of resolveed costs on higher volumes and potentially favourable input cost dynamics. The operating profit before depreciation, interest, tax and other income stood at ₹5.44 crores, up from ₹2.32 crores sequentially.
However, the quarterly performance must be contextualised against the company’s full-year trajectory. For FY25, Teesta Agro reported annual revenue of ₹187.00 crores with net profit of ₹6.00 crores, representing profit margins of 3.21%. The nine-month FY26 revenue through December 2025 totalled ₹193.62 crores with cumulative profit of ₹5.10 crores, suggesting the company is on track to match or marginally exceed prior year performance, though not dramatically so.
Revenue (Q3 FY26)
₹89.80 Cr
▲ 34.86% QoQ | ▲ 38.41% YoY
Net Profit (Q3 FY26)
₹2.95 Cr
▲ 56.90% QoQ | ▲ 56.91% YoY
Operating Margin
6.06%
Up from 3.48% in Q2
PAT Margin
3.29%
Up from 1.83% in Q2
Cost management displayed mixed results. Employee costs surged to ₹3.80 crores in Q3 FY26 from ₹1.92 crores in Q2 FY26, likely reflecting seasonal hiring or performance-linked compensation. Interest costs increased to ₹0.44 crores from ₹0.13 crores, whilst depreciation nearly doubled to ₹0.96 crores from ₹0.48 crores. The tax rate remained stable at 27.16%, in line with the company’s historical effective tax rate of around 28.40%.
Operational Challenges: Weak Returns on Capital Employed
Despite the strong quarterly displaying, Teesta Agro’s operational efficiency metrics reveal structural challenges. The company’s return on equity stands at just 6.47% for the latest fiscal year, with a five-year average of 5.34%. This places Teesta Agro well below the threshold for quality capital allocation, indicating the company struggles to generate meaningful returns for shareholders relative to the equity capital employed in the business.
Return on capital employed paints a slightly better picture at 9.24% for the latest year and an average of 6.92% over five years, but this still falls short of the cost of capital for most investors. The company’s five-year sales growth of 4.20% has been anaemic, whilst EBIT growth of 17.12% over the same period suggests some operating leverage, though from a low base. The average sales to capital employed ratio of 1.61x indicates modest asset turnover efficiency.
Capital Efficiency Concerns
Key Metrics: With ROE averaging just 5.34% over five years and latest ROE at 6.47%, Teesta Agro demonstrates weak capital efficiency. This low return on equity indicates the company generates minimal profits relative to shareholder capital, raising questions about the sustainability of value creation. Investors should note that higher ROE values indicate better capital efficiency and profitability—Teesta Agro’s single-digit returns fall well short of quality benchmarks.
On the positive side, Teesta Agro maintains a conservative balance sheet. The company operates as a net cash entity with an average net debt to equity ratio of -0.02, meaning cash exceeds borrowings. As of March 2025, long-term debt stood at ₹2.47 crores against shareholder funds of ₹117.55 crores. The debt to EBITDA ratio averaged 1.02x over five years, indicating manageable leverage. Cash and equivalents totalled ₹25.00 crores as of March 2025, up from ₹10.00 crores the prior year, providing a comfortable liquidity cushion.
Working capital management requires attention. Trade payables stood at ₹43.25 crores as of March 2025, whilst current assets totalled ₹127.71 crores. The company generated ₹9.00 crores in operating cash flow for FY25, though this was aided by minimal working capital modifys. The seasonal nature of the fertiliser business creates lumpy cash flow patterns, with Q3 typically representing peak working capital deployment.
Indusattempt Context: Navigating a Competitive Landscape
The Indian fertiliser indusattempt operates under a complex regulatory framework with government-controlled pricing for key products and subsidy mechanisms that influence profitability. Teesta Agro manufactures NPK fertilisers, single super phosphate, granulated single super phosphate, mixture fertilisers, and micronutrients, with export markets in Bangladesh, Nepal, and Bhutan supplementing domestic sales.
The company’s Q3 performance aligns with typical seasonal patterns in the sector, with the October-December quarter representing peak demand as farmers prepare for rabi crop sowing. However, the fertiliser indusattempt faces structural headwinds including input cost volatility, subsidy payment delays, intense competition from larger players, and depfinishence on monsoon patterns and agricultural output prices.
Teesta Agro’s micro-cap status (₹60.00 crores market capitalisation) positions it as a niche regional player rather than a national-scale operator. The company’s operations in West Bengal’s Jalpaiguri district provide proximity to tea estates and agricultural regions, but limit geographic diversification. Export sales to neighbouring countries offer some revenue stability, though cross-border trade dynamics and currency fluctuations add complexity.
Competitive Positioning
Teesta Agro operates in a fragmented indusattempt dominated by larger players with superior economies of scale, distribution networks, and access to capital. The company’s regional focus and export orientation to Bangladesh, Nepal, and Bhutan provide niche positioning, but constrain growth potential compared to pan-India operators. The lack of institutional investor interest (just 3.75% institutional holdings) reflects concerns about scale, liquidity, and long-term competitive positioning.
| Company | Market Cap | P/E Ratio | P/BV Ratio | ROE (%) | Debt/Equity |
|---|---|---|---|---|---|
| Teesta Agro Ind. | ₹60 Cr | 8.05 | 0.52 | 5.34% | -0.02 |
| Nagarjuna Fert. | — | NA (Loss Making) | -0.31 | 0.0% | -0.01 |
| Bluegod Enterta. | — | 29.74 | 4.88 | 0.0% | 0.13 |
| Bharat Agri Fert | — | 145.84 | 2.61 | 0.76% | 1.49 |
| Basant Agro Tech | — | 18.58 | 0.52 | 6.70% | 0.71 |
| Phosphate Co | — | 25.12 | 0.60 | 3.55% | 0.13 |
Relative to fertiliser sector peers, Teesta Agro trades at a significant valuation discount with a P/E ratio of 8.05x compared to peers averaging 55x (excluding loss-building entities). The company’s price-to-book ratio of 0.52x suggests the market values the business below net asset value, typically a sign of scepticism about future earnings power. However, Teesta Agro’s ROE of 5.34% exceeds most comparable peers, providing some fundamental justification for investment consideration, though absolute returns remain weak.
Valuation Analysis: Attractive Enattempt Point or Value Trap?
Teesta Agro Industries trades at compelling valuation multiples that merit attention despite operational concerns. The stock’s P/E ratio of 8.05x represents a substantial discount to the fertiliser sector average of 23x, suggesting either a significant opportunity or market recognition of structural limitations. The price-to-book ratio of 0.52x indicates the stock trades at nearly half of net asset value, a level typically associated with distressed situations or deep value opportunities.
The company’s enterprise value multiples paint a similar picture. EV/EBITDA of 4.35x and EV/EBIT of 5.51x both suggest modest valuations relative to earning power. The EV/Sales ratio of 0.29x and EV/Capital Employed of 0.51x indicate the market assigns minimal premium to the company’s revenue generation or asset base. The PEG ratio of 0.08x appears extraordinarily attractive, though this metric can be misleading given the company’s volatile earnings history.
P/E Ratio (TTM)
8.05x
vs Sector: 23x
Price to Book
0.52x
Below Net Asset Value
EV/EBITDA
4.35x
Modest Multiple
Dividfinish Yield
NA
No Dividfinish
The valuation grade has fluctuated between “Fair” and “Attractive” over recent months, most recently assessed as “Fair” since November 2025. This volatility in valuation assessment reflects the tension between cheap multiples and weak fundamental quality. The stock currently trades 32.45% below its 52-week high of ₹164.40, having found support near ₹91.00, representing a 22.03% cushion above the 52-week low.
Estimating fair value for Teesta Agro requires balancing the attractive multiples against structural profitability challenges. Using a normalised earnings approach based on FY25 profit of ₹6.00 crores and applying a 12x P/E multiple (50% premium to current but still below sector average), fair value would approximate ₹128.00 per share, suggesting 15.28% upside from current levels. However, this assumes the company can sustain or improve current profitability levels, which remains uncertain given the weak ROE profile.
Shareholding Pattern: Stable Promoter Base, Minimal Institutional Interest
Teesta Agro’s shareholding structure reflects a promoter-dominated entity with minimal institutional participation. Promoter holding has remained remarkably stable at approximately 44.30% over the past five quarters, with marginal increases of 0.01% in September 2025 and March 2025. The promoter group is led by founder Hardev Singh (28.38%), with family members Joginder Kaur (10.47%), Paramdeep Singh (2.76%), and Inderdeep Singh (2.69%) comprising the balance.
| Quarter | Promoter | FII | Mutual Funds | Insurance | Other DII | Non-Institutional |
|---|---|---|---|---|---|---|
| Dec’25 | 44.31% | 0.00% | 3.75% | 0.00% | 0.00% | 51.93% |
| Sep’25 | 44.31% (+0.01%) | 0.00% | 3.75% | 0.00% | 0.00% | 51.94% |
| Jun’25 | 44.30% | 0.00% | 3.75% | 0.00% | 0.00% | 51.94% |
| Mar’25 | 44.30% (+0.01%) | 0.00% | 3.75% | 0.00% | 0.00% | 51.94% |
| Dec’24 | 44.29% | 0.00% | 3.75% | 0.00% | 0.00% | 51.96% |
Institutional participation remains minimal, with mutual funds holding a steady 3.75% across all five quarters through three fund houtilizes. Foreign institutional investors, insurance companies, and other domestic institutional investors have zero exposure to the stock. The absence of institutional interest reflects concerns about liquidity, scale, corporate governance standards, and growth visibility that typically deter professional fund managers from micro-cap investments.
Non-institutional investors (retail and high-net-worth individuals) hold approximately 51.93% of the equity, representing the free float available for trading. The stability in shareholding pattern suggests limited purchaseing or selling pressure from existing stakeholders, though the low trading volumes (just 1,104 shares on January 30, 2026) indicate minimal market interest. Positively, there is no promoter pledging, eliminating concerns about forced selling or financial stress at the promoter level.
Stock Performance: Long-Term Gains Offset by Recent Weakness
Teesta Agro’s stock price trajectory presents a study in contrasts between exceptional long-term returns and concerning recent performance. Over ten years, the stock has delivered a remarkable 598.87% return, vastly outperforming the Sensex’s 230.79% gain and generating alpha of 368.08 percentage points. The five-year return of 475.39% similarly dwarfs the Sensex’s 77.74%, demonstrating substantial wealth creation for patient, long-term investors.
| Period | Stock Return | Sensex Return | Alpha |
|---|---|---|---|
| 1 Day | +3.54% | -0.36% | +3.90% |
| 1 Week | -0.05% | +0.90% | -0.95% |
| 1 Month | -3.43% | -2.84% | -0.59% |
| 3 Months | -6.33% | -2.53% | -3.80% |
| 6 Months | -25.32% | +0.97% | -26.29% |
| YTD | -2.50% | -3.46% | +0.96% |
| 1 Year | +9.25% | +7.18% | +2.07% |
| 2 Years | +16.85% | +15.65% | +1.20% |
| 5 Years | +475.39% | +77.74% | +397.65% |
| 10 Years | +598.87% | +230.79% | +368.08% |
However, recent performance informs a different story. The stock has declined 25.32% over the past six months, significantly underperforming the Sensex’s marginal 0.97% gain and generating negative alpha of 26.29 percentage points. The three-month return of -6.33% and one-month decline of 3.43% reflect sustained selling pressure. Even the one-year return of 9.25%, whilst positive and ahead of the Sensex’s 7.18%, minquires the sharp correction from peak levels.
Technical indicators paint a uniformly bearish picture. The stock currently trades below all key relocating averages: 5-day (₹108.87), 20-day (₹114.27), 50-day (₹115.13), 100-day (₹117.18), and 200-day (₹118.04). The overall technical trfinish turned bearish on January 16, 2026, at ₹115.55, following a brief period of mildly bearish sentiment. Weekly and monthly MACD signals remain bearish, whilst Bollinger Bands suggest continued bearish momentum on the weekly timeframe and sideways consolidation on monthly charts.
The stock’s beta of 1.50 indicates high volatility relative to the broader market, with the stock relocating 50% more than the Sensex in either direction. This high-beta characteristic, combined with 62.49% annualised volatility, classifies Teesta Agro as a “HIGH RISK MEDIUM RETURN” investment. The risk-adjusted return of 0.15 over one year compares unfavourably to the Sensex’s 0.64, suggesting investors are not being adequately compensated for the elevated risk profile.
“The divergence between exceptional long-term returns and recent underperformance reflects the challenge of sustaining growth from a low base—initial gains came easily, but scaling profitably proves far more difficult.”
Investment Thesis: Value Trap or Contrarian Opportunity?
The investment case for Teesta Agro Industries rests on a foundation of attractive valuation metrics offset by significant quality and momentum concerns. The company’s Mojo Score of 47 out of 100 places it in “SELL” territory, reflecting the tension between cheap multiples and weak fundamentals. Breaking down the four key investment parameters reveals the complexity of the thesis.
Valuation (Attractive): Trading at 8.05x P/E and 0.52x price-to-book, Teesta Agro offers compelling enattempt multiples for value-oriented investors. The stock trades at a 65% discount to sector P/E and below net asset value, suggesting significant margin of safety if the company can maintain or improve current profitability levels.
Quality (Below Average): The company’s quality grade of “Below Average” reflects weak return on equity averaging 5.34% over five years and just 6.47% in the latest fiscal year. Higher ROE values indicate better capital efficiency and profitability—Teesta Agro’s single-digit returns demonstrate the company struggles to generate meaningful profits relative to shareholder capital. Five-year sales growth of 4.20% and ROCE of 6.92% further highlight operational challenges.
Financial Trfinish (Positive): The short-term financial trfinish turned positive in Q3 FY26, driven by strong revenue growth, margin expansion, and profit improvement. However, this positive momentum reflects seasonal patterns rather than structural transformation, and sustainability remains uncertain.
Technical Trfinish (Bearish): All technical indicators flash warning signals, with the stock in a confirmed bearish trfinish, trading below all relocating averages, and displaying negative momentum across multiple timeframes. The 25.32% decline over six months and position 32.45% below 52-week highs indicate sustained selling pressure.
Key Strengths ✓
- Attractive Valuation: P/E of 8.05x and P/BV of 0.52x offer significant discount to intrinsic value
- Zero Debt: Net cash position eliminates financial risk and provides flexibility
- No Pledging: Clean promoter holding with zero shares pledged
- Strong Q3 Performance: Revenue up 34.86% QoQ and 38.41% YoY with margin expansion
- Long-Term Track Record: 598.87% return over 10 years demonstrates wealth creation potential
- Stable Shareholding: Consistent promoter holding around 44% displays management commitment
- Regional Expertise: Established presence in West Bengal and export markets
Key Concerns ⚠
- Weak ROE: Average ROE of 5.34% indicates poor capital efficiency and value creation
- Bearish Technicals: Stock below all relocating averages with negative momentum across timeframes
- Micro-Cap Liquidity: ₹60 crore market cap with minimal daily volumes limits institutional interest
- Seasonal Volatility: Lumpy quarterly performance creates earnings unpredictability
- Limited Scale: Small size constrains competitive positioning and growth potential
- Zero Institutional Interest: Just 3.75% institutional holdings reflects quality concerns
- High Volatility: Beta of 1.50 and 62.49% volatility create significant price risk
Outview: What Lies Ahead
The outview for Teesta Agro Industries hinges on the company’s ability to convert seasonal strength into sustained profitability improvement whilst addressing structural return on equity challenges. The fourth quarter of FY26 (January-March 2026) will provide crucial insights into whether Q3’s strong performance represents a turning point or merely typical seasonal patterns.
Positive Catalysts
- Sustained Margin Improvement: If operating margins remain above 5-6% beyond peak season
- Export Growth: Expansion in Bangladesh, Nepal, and Bhutan markets
- Technical Reversal: Stock reclaiming 200-day MA at ₹118 would signal trfinish modify
- Institutional Enattempt: Any meaningful institutional purchaseing would validate investment thesis
- Capacity Expansion: Capital deployment in higher-margin products or geographies
Red Flags
- Q4 Disappointment: Weak sequential performance would confirm seasonal nature of Q3 strength
- Margin Compression: Return to 3-4% operating margins in off-season quarters
- Technical Breakdown: Fall below ₹91 support would trigger further selling
- Working Capital Stress: Deterioration in cash conversion or liquidity metrics
- Continued Underperformance: Failure to match sector returns over next 6-12 months
Investors should monitor several key metrics over coming quarters: (1) whether operating margins can sustain above 5% in non-peak quarters, (2) progress on improving return on equity towards double-digit levels, (3) any institutional purchaseing that would validate the value thesis, (4) technical price action around key support (₹91) and resistance (₹118) levels, and (5) management commentary on capacity expansion or strategic initiatives to improve competitive positioning.
The Verdict: Avoid Despite Cheap Valuation
SELL
Score: 47/100
For Fresh Investors: Avoid initiating positions despite attractive valuation multiples. The combination of weak return on equity (5.34% average), bearish technical trfinish, micro-cap liquidity constraints, and lack of institutional validation outweigh the cheap P/E and P/BV ratios. The 25.32% decline over six months reflects legitimate concerns about sustainable profitability rather than temporary mispricing.
For Existing Holders: Consider reducing positions on any technical bounce towards ₹118-120 levels. Whilst the long-term track record has been exceptional, recent underperformance and structural profitability challenges suggest better opportunities exist elsewhere. Hold only if conviction exists that management can materially improve return on equity and sustain margin improvements beyond seasonal peaks.
Fair Value Estimate: ₹128.00 (15.28% upside potential, but execution risk remains high)
Note- ROCE= (EBIT – Other income)/(Capital Employed – Cash – Current Investments)
⚠️ Investment Disclaimer
This article is for educational and informational purposes only and should not be construed as financial advice. Investors should conduct their own due diligence, consider their risk tolerance and investment objectives, and consult with a qualified financial advisor before building any investment decisions.
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