Golkunda Diamonds & Jewellery downgraded to 'Hold' by MarketsMOJO after positive growth in recent financial results

Golkunda Diamonds & Jewellery, a microcap company in the jewellery industry, has recently been downgraded to a 'Hold' by MarketsMOJO on April 29, 2024. This decision was based on the company's recent financial results, which showed positive growth after two consecutive negative quarters.
In the last quarter, Golkunda Diamonds & Jewellery saw a significant increase in its PBT LESS OI(Q) at Rs 4.11 crore, which grew by 103.7%. Its PAT(Q) also saw a growth of 93.0% at Rs 3.19 crore, while its PBDIT(Q) reached its highest at Rs 5.08 crore. These positive results have contributed to the company's stock being in a mildly bullish range.

Moreover, the company's technical factors, such as MACD and Bollinger Band, are also showing bullish trends. With a ROCE of 14.8, Golkunda Diamonds & Jewellery has a very attractive valuation and is currently trading at a discount compared to its average historical valuations. However, despite generating a return of 62.71% in the past year, the company's profits have fallen by -20.4%.

On a positive note, Golkunda Diamonds & Jewellery has consistently outperformed BSE 500 in the last three annual periods, making it a reliable investment option. However, the company's high debt to EBITDA ratio of 3.70 times raises concerns about its ability to service debt in the long run. Additionally, the decreasing stake of promoters by -0.78% in the previous quarter may indicate a lack of confidence in the company's future prospects.

In conclusion, while Golkunda Diamonds & Jewellery has shown positive growth in its recent financial results, its high debt and decreasing promoter stake may be a cause for concern. Investors are advised to hold onto their stocks for now and monitor the company's performance closely.