Nectar Lifescience Receives 'Hold' Rating from MarketsMOJO Based on Strong Financial Performance.

Nectar Lifescience, a microcap pharmaceutical company, has recently received a 'Hold' rating from MarketsMOJO on August 22, 2024. This upgrade is based on the company's positive financial results for the last four consecutive quarters.
In the last quarter, Nectar Lifescience saw a significant growth of 233.6% in its PBT LESS OI(Q) at Rs 4.37 crore. Additionally, its ROCE(HY) reached a high of 6.18%, while its DEBT-EQUITY RATIO(HY) remained at a low of 0.59 times. These factors contribute to the company's attractive valuation with a ROCE of 5.5 and an enterprise value to capital employed ratio of 0.9.

Technically, the stock is in a mildly bullish range and has shown improvement from a sideways trend on August 22, 2024. Multiple indicators such as MACD, Bollinger Band, KST, and OBV also suggest a bullish outlook for the stock.

Over the past year, Nectar Lifescience has outperformed the market with a return of 48.42%, while its profits have increased by 123.4%. This has resulted in a PEG ratio of 1.1, indicating that the stock is trading at a discount compared to its average historical valuations.

However, the company's long-term fundamental strength is weak with a -140.03% CAGR growth in operating profits over the last five years. It also has a high debt to EBITDA ratio of 6.63 times, indicating a low ability to service debt. The company's return on equity (avg) of 1.88% also signifies low profitability per unit of shareholders' funds.

Investors should also be aware that 100% of the promoter shares are pledged, which could put additional downward pressure on the stock prices in falling markets. Overall, while Nectar Lifescience has shown promising financial results in the short term, its long-term fundamentals and high promoter pledged shares should be considered before making any investment decisions.