Netweb Technologies shares tumble over 7% amid AI sell‑off and lofty valuation

Netweb Technologies shares slid more than 7% on Friday, extending a seven‑day losing streak and taking the stock over 15% lower in the past week. The price touched an intraday low of ₹3,717, leaving the share about 38% under its 52‑week peak of ₹5,810 recorded in August 2026; the 52‑week trough stands at ₹2,942.45. Over the last week the stock has fallen 10%, 21% in the past month, 22% over three months and 14% in six months, though it is up 13% year‑to‑date. The drop follows a broader global sell‑off in artificial‑intelligence and technology equities, heightened worries about the stock’s high valuation and a slight easing of profit margins. Netweb trades at a trailing price‑to‑earnings multiple of roughly 58‑70 times, leaving little cushion for disappointment. Its net‑profit margin slipped by nine basis points year‑on‑year to 10.3% and fell eight basis points from the previous quarter. Despite the market pressure, the company posted a sharp earnings jump in the September quarter. Consolidated profit after tax rose to ₹136.7 crore from ₹31.4 crore a year earlier, while revenue climbed to ₹1,323.3 crore from ₹303.7 crore. Revenue grew 61.5% sequentially, net profit 60.6% and EBITDA 64.4% to ₹197 crore, pushing the EBITDA margin to 14.9% from 14.6%. The order book stood at ₹2,629 crore at the end of September 2026. Chairman and Managing Director Sanjay Lodha called the quarter “record” and said first‑half FY27 profit of ₹222 crore already exceeds the full‑year FY26 profit of ₹205.8 crore. BofA Securities started coverage with a Buy recommendation, a target of ₹5,000 per share and an implied upside of about 34.5%, citing Netweb’s 15‑year partnership with NVIDIA, super‑computing know‑how and long‑standing government contracts. The broker expects revenue to grow around 40% annually through FY29 and believes operating leverage will help keep pricing competitive and profitability stable.## Context AI‑focused stocks have been especially sensitive to shifts in investor sentiment, and companies with high price‑to‑earnings ratios can see large price swings when market mood changes. Strong earnings growth may not be enough to offset valuation worries if the broader AI sector faces headwinds.