Home First Finance Company India Downgraded to 'Hold' by MarketsMOJO

Home First Finance Company India, a midcap finance company in the housing industry, has recently been downgraded to a 'Hold' by MarketsMOJO on November 4, 2024. This decision was based on the company's strong long-term fundamental strength, with a 30.09% CAGR growth in operating profits.
The company has shown consistent positive results for the last 13 quarters, with its PBDIT(Q) reaching a high of Rs 298.21 crore, PBT LESS OI(Q) at Rs 119.04 crore, and PAT(Q) at Rs 92.23 crore. This indicates a healthy long-term growth trend for the company.

Technically, the stock is currently in a mildly bullish range, with the key technical factor KST being bullish since November 4, 2024. Additionally, the company has a high institutional holding of 37.99%, which suggests that these investors have better capabilities and resources to analyze the company's fundamentals compared to retail investors.

However, with a ROE of 15, the stock is currently trading at a very expensive valuation with a 4.5 price to book value. This is higher than its average historical valuations. While the stock has generated a return of 26.09% over the past year, its profits have only risen by 28.6%, resulting in a PEG ratio of 1.1.

Overall, while Home First Finance Company India has shown strong long-term growth potential, its current valuation and technical indicators suggest a 'Hold' rating for the stock. Investors should carefully consider these factors before making any investment decisions.