MarketsMOJO Downgrades Nocil to 'Sell' Due to Poor Growth and Negative Results

Nocil, a smallcap company in the chemicals industry, has recently been downgraded to a 'Sell' by MarketsMOJO on September 10, 2024. This decision was based on the company's poor long-term growth, with an annual rate of -7.45% over the last 5 years. In addition, the company reported negative results in June 2024, with a decrease in PAT(Q) at Rs 27.06 crore and PBDIT(Q) at its lowest at Rs 41.05 crore. The operating profit to net sales (Q) was also at its lowest at 11.03%.
Furthermore, Nocil has a very expensive valuation with a price to book value of 2.9 and a ROE of 7.8. The stock is currently trading at a premium compared to its average historical valuations. Despite generating a return of 17.53% in the past year, its profits have only risen by 7.5%, resulting in a high PEG ratio of 5.2.

In the last year, Nocil has underperformed the market, with a return of 17.53% compared to the market's (BSE 500) return of 34.61%. The company also has a low debt to equity ratio (avg) of 0 times.

Technically, the stock is in a mildly bullish range, with multiple factors such as MACD, Bollinger Band, and KST indicating a bullish trend. However, despite these indicators, institutional investors have increased their stake in the company by 0.92% over the previous quarter, collectively holding 12.22% of the company. This suggests that these investors, who have better resources and capabilities to analyze company fundamentals, have also lost confidence in Nocil's potential for growth.

In conclusion, Nocil's recent downgrade to 'Sell' by MarketsMOJO and its poor long-term growth, negative results, and expensive valuation make it a risky investment option. Additionally, the company's underperformance in the market and lack of interest from institutional investors further support the 'Sell' recommendation. Investors should carefully consider these factors before making any investment decisions regarding Nocil.