NCL Industries Upgraded to 'Hold' Rating by MarketsMOJO, Shows Strong Debt Servicing Ability and Positive Results

NCL Industries, a microcap cement company, has recently been upgraded to a 'Hold' rating by MarketsMOJO. This upgrade is based on the company's strong ability to service debt, with a low Debt to EBITDA ratio of 1.33 times. Additionally, the company has shown positive results in the first half of 2024, with a 62.11% growth in PAT and a record high ROCE of 15.89%. NCL Industries also has a healthy cash reserve of Rs 53.92 crore.
The stock is currently trading at a discount compared to its historical valuations and has a very attractive valuation with a 1.1 Enterprise value to Capital Employed. However, the company has shown poor long-term growth, with an annual rate of -35.55% in operating profit over the last 5 years.

Technically, the stock is in a mildly bearish range, with both its Bollinger Band and KST technical factors being bearish. Furthermore, there has been a decrease in promoter confidence, as they have reduced their stake in the company by -0.77% over the previous quarter. This may signify a lack of confidence in the future of the business.

In the last 1 year, NCL Industries has underperformed the market, generating a return of only 10.06% compared to the market's (BSE 500) returns of 32.70%. While the company has shown positive results in the short term, its long-term growth and technical indicators suggest caution for potential investors. It is advisable to closely monitor the company's performance before making any investment decisions.