Lumax Industries Receives 'Hold' Rating from MarketsMOJO, Technical Indicators Point to Bullish Trend

Lumax Industries, a smallcap company in the auto ancillary industry, has recently received a 'Hold' rating from MarketsMOJO. The stock has shown a bullish trend and has improved from mildly bullish to a more positive outlook on August 22, 2024.
The company's technical indicators such as MACD, Bollinger Band, DOW, and OBV are all pointing towards a bullish trend. Additionally, with a ROCE of 10.2 and an attractive valuation of 2.5 Enterprise value to Capital Employed, the stock is currently trading at a discount compared to its historical valuations.

Over the past year, Lumax Industries has generated a return of 32.67%, while its profits have increased by 11.6%. However, the company's long-term fundamental strength is weak with an average ROCE of 9.68%. Its net sales have only grown at a rate of 9.48% and operating profit at 3.37% over the last 5 years.

Furthermore, Lumax Industries has a high debt to EBITDA ratio of 2.74 times, indicating a low ability to service debt. The company's recent results for June 2024 have been flat, with the lowest operating profit to interest ratio at 3.56 times, lowest inventory turnover ratio at 4.53 times, and highest debt-equity ratio at 1.08 times.

It is worth noting that the majority shareholders of Lumax Industries are promoters, which can be seen as a positive sign for the company's stability and long-term growth potential. However, considering the weak long-term fundamentals and high debt levels, MarketsMOJO has upgraded the stock to a 'Hold' rating, suggesting a cautious approach for investors.