Cello World Limited Stock Analysis
Cello World Limited (CELLO) is a India-based company listed on NSE. This AI-powered analysis provides investment insights based on quarterly earnings reports and financial performance metrics.
Overall verdict: HOLD, with solid balance-sheet quality but clear near-term earnings deceleration. On a consolidated basis, Q3 FY26 revenue from operations was Rs 55,366.45 lakhs (down ~0.6% YoY and ~2.4% QoQ), while profit after tax fell to Rs 6,940.57 lakhs from Rs 9,209.91 lakhs YoY, with an exceptional labour-code impact of Rs 743.82 lakhs. Even before exceptional items, profit before tax declined to Rs 10,182.50 lakhs versus Rs 12,436.65 lakhs YoY, indicating underlying margin pressure. Positively, 9M FY26 revenue still grew to Rs 1,67,011.57 lakhs from Rs 1,54,756.68 lakhs, finance cost remained very low at Rs 55.51 lakhs in Q3, and QIP utilization disclosure shows no deviation with significant repayment of legacy borrowings.
AI Investment Score & Analysis
+ Key Strengths
- Key Risks
Forward Outlook
Strategically, the board approved internal capital restructuring at Cello Consumerware Private Limited: conversion of Rs 500 crore inter-company loans into equity plus a fresh Rs 100 crore equity infusion, with no change in ownership/control. The group also expanded its legal-entity base during the period with Cello Writing and Stationery Private Limited (Dec 10, 2025) and Cello Tips Private Limited (Dec 23, 2025) included as subsidiaries. A key catalyst for the next 2-4 quarters is the pending NCLT final order on the approved composite scheme involving Wim Plast Limited, Cello Consumer Products Private Limited, and Cello World Limited. Momentum currently looks decelerating in the latest quarter (sales and profit down YoY/QoQ), so near-term performance will likely depend on execution of restructuring/integration and stabilization of operating margins.
Detailed AI Analysis by Provider
Cello World's Q3 FY26 standalone results reveal significant deterioration with revenue declining 5.2% YoY to ₹253.72 crore and profit plummeting 67.8% to ₹85.54 lakh, primarily due to a ₹198.13 lakh exceptional charge from new Labour Codes implementation. Even excluding the exceptional item, profit before tax fell 52.4% YoY from ₹364.37 crore to ₹173.54 crore, indicating severe operational stress. Consolidated results show better resilience with revenue up 0.6% YoY to ₹553.66 crore and profit at ₹694.06 crore (down 24.6% YoY), but the nine-month consolidated profit declined 25% YoY from ₹2,684.13 crore to ₹2,013.84 crore, reflecting persistent margin pressure and slowing momentum across the consumer products portfolio.
Forward Outlook
The company recently completed ₹600 crore internal capital restructuring at subsidiary Cello Consumerware (₹500 crore loan-to-equity conversion plus ₹100 crore fresh infusion) to strengthen its stainless steel bottles and insulated-ware manufacturing vertical, which received ₹62.89 crore from the July 2024 QIP. However, the report provides no forward guidance on revenue targets, capacity utilization timelines, or demand outlook. The pending NCLT approval for the three-way merger scheme (announced November 2024) remains a key catalyst that could streamline operations and unlock synergies, but execution timeline is unclear. With Q3 momentum sharply decelerating (standalone EPS down to ₹0.39 from ₹1.23 YoY) and labour code compliance costs creating near-term headwinds, the next 2-3 quarters will likely focus on margin stabilization rather than growth acceleration. No new product launches, export expansion plans, or demand recovery signals mentioned in this quarterly disclosure.
Strengths
Risks
Overall verdict: HOLD, with solid balance-sheet quality but clear near-term earnings deceleration. On a consolidated basis, Q3 FY26 revenue from operations was Rs 55,366.45 lakhs (down ~0.6% YoY and ~2.4% QoQ), while profit after tax fell to Rs 6,940.57 lakhs from Rs 9,209.91 lakhs YoY, with an exceptional labour-code impact of Rs 743.82 lakhs. Even before exceptional items, profit before tax declined to Rs 10,182.50 lakhs versus Rs 12,436.65 lakhs YoY, indicating underlying margin pressure. Positively, 9M FY26 revenue still grew to Rs 1,67,011.57 lakhs from Rs 1,54,756.68 lakhs, finance cost remained very low at Rs 55.51 lakhs in Q3, and QIP utilization disclosure shows no deviation with significant repayment of legacy borrowings.
Forward Outlook
Strategically, the board approved internal capital restructuring at Cello Consumerware Private Limited: conversion of Rs 500 crore inter-company loans into equity plus a fresh Rs 100 crore equity infusion, with no change in ownership/control. The group also expanded its legal-entity base during the period with Cello Writing and Stationery Private Limited (Dec 10, 2025) and Cello Tips Private Limited (Dec 23, 2025) included as subsidiaries. A key catalyst for the next 2-4 quarters is the pending NCLT final order on the approved composite scheme involving Wim Plast Limited, Cello Consumer Products Private Limited, and Cello World Limited. Momentum currently looks decelerating in the latest quarter (sales and profit down YoY/QoQ), so near-term performance will likely depend on execution of restructuring/integration and stabilization of operating margins.
Strengths
Risks
Score History
Score Timeline
All Scores
| Date | Report | Score | Sentiment | AI | |
|---|---|---|---|---|---|
| Feb 14, 2026 | Cello World Limited - Financial Results (14/2/2026) | 4.5 | Sell | Claude | |
| Feb 14, 2026 | Cello World Limited - Financial Results (14/2/2026) | 6.0 | Hold | ChatGPT |
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Frequently Asked Questions
What is the AI Stock Score?
The AI Stock Score is a composite rating from 0-10 generated by analyzing quarterly earnings reports using three leading AI models (Google Gemini, Anthropic Claude, and OpenAI ChatGPT). Each AI independently evaluates financial performance, growth prospects, risks, and market positioning to provide an objective investment perspective.
How should I interpret Buy/Hold/Sell ratings?
Buy (7.0-10.0): Strong fundamentals and positive outlook. Hold (4.0-6.9): Mixed signals, suitable for existing positions. Sell (0-3.9): Deteriorating fundamentals or significant risks. These are AI-generated opinions for informational purposes only, not investment advice.
How is the composite score calculated?
The composite score is the mathematical average of the latest scores from each AI provider. For example, if Gemini rates 7.5, Claude rates 4.5, and ChatGPT rates 6.0, the composite score would be (7.5+4.5+6.0)/3 = 6.0. This multi-AI approach reduces bias from any single model.
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