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

Hikal, a smallcap pharmaceutical and drug company, has recently received a 'Hold' rating from MarketsMOJO on October 14, 2024. This upgrade comes as the stock has shown a bullish trend and has improved from a mildly bullish status on the same date.

The technical indicators for the stock, such as MACD, Bollinger Band, and KST, are all pointing towards a bullish outlook. Additionally, with a ROCE (Return on Capital Employed) of 7.5, the stock is currently trading at an attractive valuation with an enterprise value to capital employed ratio of 2.7. This indicates that the stock is currently undervalued compared to its historical average.

However, the company's profits have seen a decline of -28.1% over the past year, despite generating a return of 27.85%. The majority shareholders of Hikal are its promoters, which may have influenced the recent upgrade to a 'Hold' rating.

On a long-term basis, the company has shown poor growth with an annual rate of -6.61% in operating profit over the last 5 years. In addition, the company declared very negative results in June 2024 with a fall in net sales of -20.89%. The PBT (Profit Before Tax) and PAT (Profit After Tax) for the quarter have also seen a significant decline of -72.5% and -70.7%, respectively. The ROCE for the half-year period is at its lowest at 7.57%.

Overall, while the technical indicators and attractive valuation may make Hikal a hold for now, the company's poor long-term growth and recent negative results should be taken into consideration by investors.