Newjaisa Technologies Stock Crashes 19% After Amazon India Shuts Down Refurbished Product Category
The shares of Newjaisa Technologies Ltd, a microcap company specializing in refurbished IT electronics, took a massive hit on Tuesday after Amazon India announced the discontinuation of its refurbished product category across all product lines. The news triggered a sharp selloff in Newjaisa’s stock, leading to a 19.6% drop and pushing it to a 52-week low of ₹50.55 per share.
Stock Performance: A Sharp Decline
Newjaisa Technologies witnessed a significant drop in its stock price as soon as the market opened. At its lowest point, the shares fell 19.6%, marking a steep decline from the previous close of ₹62.9. However, by 10:30 AM, the stock managed to recover slightly, trading at ₹52.65 per share, which was still 16.3% lower than its last closing price.
Why Did Newjaisa Technologies Stock Crash?
The primary reason behind this crash is Amazon India’s decision to shut down its refurbished product category across all segments by the end of March 2025. Given that Newjaisa Technologies relies heavily on the Amazon marketplace for sales, this move is expected to have a short-term negative impact on its business.
However, the company remains optimistic. In an official statement, Newjaisa Technologies confirmed that it is confident in its direct-to-customer (D2C) online sales model, which will allow it to reach a larger customer base even without Amazon’s support.
Company’s Strategic Moves & Future Plans
Despite this setback, Newjaisa Technologies is aggressively working on expanding its reach and solidifying its position in the refurbished electronics market. Some key developments include:
- Retail Expansion: The company is set to expand into the offline retail segment, partnering with 500+ retail stores over the next 12 months.
- New Partnerships: Newjaisa has partnered with one of South India’s largest retail chains, which operates more than 400 outlets.
- Institutional Deals: It has secured two major institutional orders, strengthening its presence in the education sector.
- E-Waste Management License: The company has also obtained a government-approved e-waste management license, allowing it to source directly from corporations and reduce reliance on intermediaries.
These strategic decisions indicate that Newjaisa Technologies is actively working on mitigating risks associated with Amazon’s exit from the refurbished market.
Financial Performance: A Look at the Numbers
Despite the recent stock crash, Newjaisa Technologies has shown strong financial growth over the past year. Here’s how its financials stack up:
| Financial Metric | H1FY24 | H1FY25 | YoY Growth |
|---|---|---|---|
| Revenue from Operations | ₹26.15 Cr | ₹33.72 Cr | +29% |
| Net Profit | ₹2.9 Cr | ₹3.4 Cr | +17% |
The growth in both revenue and profitability highlights the company’s strong fundamentals, despite the recent external challenges.
Stock Market Data & Key Financial Ratios
Here are some key metrics investors should consider when evaluating Newjaisa Technologies:
| Metric | Value |
|---|---|
| Market Capitalization | ₹178 Cr |
| Current Price | ₹50.4 |
| 52-Week High / Low | ₹147 / ₹50.4 |
| Stock P/E | 26.1 |
| Book Value | ₹25.0 |
| Dividend Yield | 0.00% |
| ROCE (Return on Capital Employed) | 21.0% |
| ROE (Return on Equity) | 19.6% |
| Debt-to-Equity Ratio | 0.19 |
| Promoter Holding | 63.4% |
| Pledged Percentage | 0.00% |
| Industry P/E | 30.7 |
| Intrinsic Value | ₹190 |
| Relative Strength Index (RSI) | 30.9 (Oversold Zone) |
| Earnings Per Share (EPS) | ₹2.02 |
| 200-Day Moving Average (DMA) | ₹90.4 |
| 3-Year Free Cash Flow | ₹-39.7 Cr |
| 5-Year Free Cash Flow | ₹-33.9 Cr |
| Total Debt | ₹16.8 Cr |
| Return on Assets | 14.3% |
With an RSI of 30.9, the stock is in the oversold territory, indicating a possible short-term bounce. However, negative cash flow over the last few years remains a concern.
What’s Next for Newjaisa Technologies?
Despite the sharp decline in stock price, Newjaisa Technologies is taking proactive steps to ensure long-term growth. The company’s plans to expand into retail, strengthen institutional sales, and streamline its supply chain could help it recover from the Amazon setback.
While short-term volatility is expected, investors should keep an eye on its execution strategy in the coming months. The company’s ability to successfully pivot toward its own D2C model and retail partnerships will be key to determining its future stock performance.
Conclusion
Newjaisa Technologies Ltd has taken a hard hit following Amazon India’s decision to shut down refurbished product sales, causing its stock to crash 19.6% to a new 52-week low. However, strong financial performance, strategic expansion plans, and key partnerships could help the company bounce back in the long run.
While the short-term outlook remains uncertain, long-term investors might find value in Newjaisa Technologies if it successfully transitions away from reliance on Amazon’s platform.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.