Amrapali Industries Receives 'Hold' Rating from MarketsMOJO Amid Bullish Trend and Attractive Valuation

Amrapali Industries, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes as the stock has shown a bullish trend and has improved technically from mildly bullish to a bullish range on July 26, 2024. The stock has also shown multiple bullish factors such as MACD, Bollinger Band, and KST.
One of the reasons for the 'Hold' rating is the company's attractive valuation with a ROCE of 1.3 and an enterprise value to capital employed ratio of 1.4. Additionally, the stock is currently trading at a discount compared to its average historical valuations. However, despite generating a return of 52.75% in the past year, the company's profits have fallen by -6%.

The majority shareholders of Amrapali Industries are the promoters, indicating their confidence in the company's performance. The stock has also shown market-beating performance in the long term as well as the near term, outperforming BSE 500 in the last 3 years, 1 year, and 3 months.

However, the company's long-term fundamental strength is weak due to its operating losses. The operating profit has only grown by an annual rate of 6.43% over the last 5 years, indicating poor long-term growth. Additionally, the company has a high debt to EBITDA ratio of 11.81 times, indicating a low ability to service debt.

In the latest quarter, the company's results have been flat with PBDIT(Q) at its lowest of Rs -2.51 crore and operating profit to net sales (Q) at -0.05%. The PBT less OI(Q) is also at its lowest of Rs -3.49 crore. Overall, while the stock has shown a bullish trend, the company's long-term fundamentals and recent financial results suggest a 'Hold' rating for now.