NINtec Systems Downgraded to 'Hold' by MarketsMOJO, Despite Strong Growth and Bullish Technical Indicators

NINtec Systems, a smallcap IT software company, has recently been downgraded to a 'Hold' by MarketsMOJO on October 21, 2024. This decision was based on the company's low Debt to Equity ratio, which is currently at 0 times on average.
However, NINtec Systems has shown healthy long-term growth with an annual increase in Net Sales and Operating profit at 43.66%. In fact, the company declared outstanding results in June 2024 with a growth in Net Profit of 82.16%. This positive trend has continued for the last 4 consecutive quarters, with PBDIT(Q) at its highest at Rs 6.37 crore and PBT LESS OI(Q) at its highest at Rs 5.93 crore. Additionally, the company's NET SALES(9M) have also increased to Rs 57.43 crore.

Technically, the stock is currently in a Mildly Bullish range, with multiple factors such as MACD, KST, and OBV indicating a bullish trend. NINtec Systems has also shown consistent returns over the last 3 years, outperforming BSE 500 in each of the last 3 annual periods and generating a return of 65.95% in the last 1 year.

However, with a ROE of 44.4, the company has a very expensive valuation with a 30.6 Price to Book Value. In the past year, while the stock has generated a return of 65.95%, its profits have remained stagnant at 0%.

It is also worth noting that despite its smallcap size, domestic mutual funds hold only 0% of the company. This could signify that either they are not comfortable with the current price or they have not conducted in-depth research on the company.

Overall, NINtec Systems has shown promising growth and consistent returns, but its expensive valuation and lack of interest from domestic mutual funds may be a cause for concern. Investors are advised to hold onto their stocks for now and keep an eye on future developments.