KM Sugar Mills Receives 'Hold' Rating from MarketsMOJO, Technical Performance Shows Bullish Trend

KM Sugar Mills, a microcap company in the sugar industry, has recently received a 'Hold' rating from MarketsMOJO on July 29, 2024. This upgrade is based on the stock's technical performance, which has shown a bullish trend since July 24, 2024, with a return of 2.43%. The company's MACD, Bollinger Band, and KST indicators are also showing bullish signals.
In terms of valuation, KM Sugar Mills has an attractive ROCE of 8.1 and a low enterprise value to capital employed ratio of 1.2. The stock is currently trading at a discount compared to its historical valuations. Despite a 61% return in the past year, the company's profits have only increased by 21%, resulting in a PEG ratio of 0.7.

The majority shareholders of KM Sugar Mills are its promoters, indicating their confidence in the company's performance. The stock has outperformed the market (BSE 500) with a return of 61% in the last year.

However, the company's long-term fundamental strength is weak, with an average ROCE of 9.53%. Its net sales and operating profit have only grown at a rate of 5.46% and 8.04%, respectively, over the last 5 years. Additionally, the company has a high debt to EBITDA ratio of 3.70 times, indicating a low ability to service debt.

In the latest financial results for March 2024, KM Sugar Mills has shown flat results with a decline in PAT (HY) by 43.38% and an increase in interest expenses by 118.50%. This may be a cause for concern for investors.

Overall, while KM Sugar Mills has shown a bullish trend in the short term, its long-term fundamentals and financial performance may warrant caution for potential investors.