Why Jubilant Ingrevia Share Price Falling

03 April 2024: Jubilant Ingrevia's share price has been on a downward trend recently, and several factors are likely contributing to this:

1. Declining Profits: A major concern for investors is the recent decline in Jubilant Ingrevia's profitability. The company's net profit for Q3 FY24 (reported in February 2024) fell significantly compared to the same period in the previous year. This raises doubts about the company's future earnings potential.
2. Missed Earnings Estimates: In the latest quarter, Jubilant Ingrevia's earnings per share (EPS) fell short of analyst expectations. This disappointment from the company can lead investors to lose confidence and sell their shares.
3. Downward Price Pressure: The prices of key raw materials like acetic acid, used in Jubilant Ingrevia's chemical intermediates business, have been falling. This decrease in selling prices squeezes the company's margins and profitability.
4. Weak Nutrition Business: The company's nutrition and health solutions business has also been facing challenges due to a flu outbreak in the US and Europe. This led to unfavorable pricing for their products and a reduction in consumption from China.
5. Market Correction: The Indian stock market, particularly the materials sector, might have undergone a correction in recent months. This broader market weakness can impact individual stocks like Jubilant Ingrevia, even if the company itself hasn't had negative news.
6. Future Growth Prospects: Investors are likely cautious about Jubilant Ingrevia's ability to regain momentum and achieve future growth. They might wait for signs of a turnaround in profitability and new growth initiatives before investing again.