MarketsMOJO Upgrades Riba Textiles to 'Hold' Rating Based on Technical Factors and Attractive Valuation

Riba Textiles, a microcap company in the textile industry, has recently received a 'Hold' rating from MarketsMOJO on July 9, 2024. This upgrade is based on various technical factors, such as the stock being in a bullish range and improvements in its technical trend.
One of the main reasons for the 'Hold' rating is the stock's attractive valuation, with a ROCE of 11.3 and a 1 Enterprise value to Capital Employed. Additionally, the stock is currently trading at a discount compared to its historical valuations.

In the past year, Riba Textiles has outperformed the market with a return of 58.02%, while its profits have also seen a 7% increase. However, the company's long-term fundamental strength is weak, with an average ROCE of 7.50% and low growth in net sales and operating profit over the last 5 years.

Furthermore, Riba Textiles has a high debt to EBITDA ratio, indicating a low ability to service debt. In the latest financial results for March 2024, the company's PBT LESS OI(Q) has fallen by -40.26%.

Despite these factors, Riba Textiles has majority shareholders in the form of promoters and has shown market-beating performance in the past year. However, investors should carefully consider the company's long-term fundamentals before making any investment decisions.