MarketsMOJO downgrades Indian Terrain Fashions to 'Sell' due to weak fundamentals and declining profits

Indian Terrain Fashions, a microcap company in the trading industry, has recently received a 'Sell' rating from MarketsMOJO on July 22, 2024. This downgrade is based on the company's weak long-term fundamental strength, with a -5.53% CAGR growth in operating profits over the last 5 years. Additionally, the company's ability to service its debt is also a concern, with a poor EBIT to Interest (avg) ratio of 1.11.
In the latest quarter, Indian Terrain Fashions reported flat results with a PBT LESS OI(Q) of Rs -2.83 crore, showing a significant decrease of -324.60% compared to the previous quarter. The company's NET SALES(Q) also saw a decline of -9.35% at Rs 114.16 crore.

Other factors contributing to the 'Sell' rating include the stock being in a mildly bullish range and multiple bullish indicators such as MACD, KST, and OBV. However, the company's return on equity (avg) of 2.91% indicates low profitability per unit of shareholders' funds.

On the positive side, Indian Terrain Fashions has a very attractive valuation with a ROCE of 2.6 and a 1.4 enterprise value to capital employed. The stock is also currently trading at a discount compared to its average historical valuations. However, despite generating a return of 29.94% in the past year, the company's profits have fallen by -214.8%.

It is worth noting that the majority of shareholders in Indian Terrain Fashions are non-institutional investors. This may indicate a lack of confidence in the company's performance and future prospects. Overall, with weak fundamental strength and declining profits, MarketsMOJO's 'Sell' rating on Indian Terrain Fashions suggests caution for potential investors.