Bambino Agro Industries downgraded to 'Sell' by MarketsMOJO due to high debt and poor growth

Bambino Agro Industries ., a microcap FMCG company, has recently been downgraded to a 'Sell' by MarketsMOJO on June 27, 2024. This decision was based on several factors, including the company's high Debt to EBITDA ratio of 3.59 times, indicating a low ability to service debt. Additionally, the company has shown poor long-term growth with only a 5.93% increase in Net Sales and 9.87% in Operating profit over the last 5 years.
Technically, the stock is currently in a Mildly Bearish range and has generated -2.61% returns since the downgrade. The key technical factor, MACD, has also been Mildly Bearish since June 27, 2024. Furthermore, Bambino Agro Industries has underperformed the market in the last year, with a return of only 5.16% compared to the market's 38.74% (BSE 500).

On a positive note, the company did show growth in its Mar 24 results, with PBT LESS OI(Q) at Rs 1.82 crore growing at 425.00% and PAT(Q) at Rs 1.74 crore growing at 171.9%. It also has a fair valuation with a ROCE of 13.9 and an Enterprise value to Capital Employed ratio of 2.2. However, the stock is currently trading at a discount compared to its average historical valuations.

It is worth noting that the majority shareholders of Bambino Agro Industries are the promoters themselves. While the stock has generated a return of 5.16% in the last year, its profits have risen by 18.7%, resulting in a PEG ratio of 1.4. Overall, MarketsMOJO's downgrade to 'Sell' for Bambino Agro Industries is based on the company's financial performance and technical trends, and investors may want to consider this before making any investment decisions.