CHD Chemicals Receives 'Hold' Rating, Shows Bullish Trend and Attractive Valuation

CHD Chemicals, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO. The stock has shown a bullish trend since May 7, 2024, with the technical trend improving from mildly bullish to bullish. One key technical factor, the Bollinger Band, has also been bullish since May 7, 2024.
The company has a very attractive valuation with a ROCE of 1.9 and an enterprise value to capital employed ratio of 0.7. It is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 43.02%, while its profits have increased by 49%. The PEG ratio of the company is 0, indicating a good value for investors.

The majority shareholders of CHD Chemicals are non-institutional investors. However, the company has weak long-term fundamental strength with a -17.20% CAGR growth in operating profits over the last 5 years. It also has a high debt to EBITDA ratio of 7.29 times, indicating a low ability to service debt. The return on equity (avg) of the company is 2.40%, which signifies low profitability per unit of shareholders' funds.

In December 2023, the company reported flat results with a net sales of Rs 11.94 crore, which has grown at a rate of -24.43% over the last 9 months. While the stock has shown a positive trend in the short term, investors should carefully consider the company's weak long-term fundamentals before making any investment decisions.