Oriental Hotels Receives 'Hold' Rating from MarketsMOJO, Despite Bullish Trend and Majority Promoter Shareholders

Oriental Hotels, a smallcap company in the hotel, resort, and restaurant industry, has recently received a 'Hold' rating from MarketsMOJO. The stock has shown a bullish trend and has generated a 1.59% return since November 14, 2024. The company's majority shareholders are promoters, and it has consistently outperformed BSE 500 in the last three years.
However, the company's management efficiency is a cause for concern, with a low ROCE of 5.49%. This indicates a low profitability per unit of total capital. Additionally, the company's ability to service its debt is weak, with a poor EBIT to Interest ratio of 1.59. The company has also shown poor long-term growth, with net sales growing at an annual rate of only 4.37% over the last five years.

In the latest financial results for September 2024, Oriental Hotels reported negative results, with a decline in profits and a low ROCE of 8.67%. The company's cash and cash equivalents were also at a low of Rs 9.40 crore. With an ROCE of 7.6, the stock is currently trading at an expensive valuation with a 3.9 enterprise value to capital employed.

Despite the recent positive trend in the stock, investors should be cautious and consider the company's weak financial performance and management efficiency. The stock is currently trading at a discount compared to its historical valuations, but its profits have also declined by -12% in the past year. Overall, MarketsMOJO's 'Hold' rating suggests a neutral stance on Oriental Hotels' stock.