Gujarat Natural Resources Receives 'Hold' Rating from MarketsMOJO, Shows Strong Sales Growth

Gujarat Natural Resources, a microcap company in the oil exploration and refineries industry, has recently received a 'Hold' rating from MarketsMOJO on March 4, 2024. This upgrade is based on the company's strong net sales growth of 115.76% in the last half year.
The stock is currently in a bullish range and has shown a technical improvement since February 29, 2024, with a return of 3.85%. This is supported by multiple factors such as MACD, Bollinger Band, KST, and OBV.

The majority shareholders of Gujarat Natural Resources are non-institutional investors. Despite this, the stock has outperformed the market (BSE 500) with a return of 75.61% in the last year, compared to the market's return of 37.47%.

However, the company's long-term fundamental strength is weak, with an average Return on Capital Employed (ROCE) of 0.21%. Its net sales and operating profit have only grown at an annual rate of 23.27% and 6.51%, respectively, over the last 5 years. Additionally, the company's ability to service its debt is poor, with a negative EBIT to Interest ratio of -1.73.

Furthermore, Gujarat Natural Resources has a very expensive valuation with a ROCE of -0.9 and an Enterprise value to Capital Employed ratio of 1.6. However, the stock is currently trading at a discount compared to its average historical valuations.

Despite the stock's impressive return in the past year, its profits have only risen by 94.9%. This suggests that the stock may be overvalued and investors should exercise caution before making any investment decisions. Overall, while the stock may have potential, it is currently recommended to hold off on investing in Gujarat Natural Resources.