Race Eco Chain Receives 'Hold' Rating from MarketsMOJO, Shows Strong Growth and Bullish Trend

Race Eco Chain, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO on August 29, 2024. This upgrade is based on the company's healthy long-term growth, technically bullish trend, and market-beating performance.
The company has shown a consistent annual growth rate of 46.50% in net sales and 45.00% in operating profit, indicating a positive long-term outlook. Additionally, the stock is currently in a bullish range and has shown improvement in technical trends.

Multiple factors such as MACD, Bollinger Band, KST, DOW, and OBV have contributed to the bullish sentiment for the stock. In the last year, the stock has generated a return of 53.01%, outperforming the BSE 500 index. This trend has also been observed in the last 3 years, 1 year, and 3 months.

However, the company's management efficiency is a cause for concern, with a low ROCE of 3.35%. This signifies a low profitability per unit of total capital, including equity and debt. The company also has a high debt to EBITDA ratio of 3.45 times, indicating a low ability to service debt.

In the quarter ending June 2024, the company reported negative results, with a fall of -21.94% in net sales and -87.30% in PBT LESS OI. The EPS for the quarter was also at its lowest at Rs 0.07.

The stock is currently trading at a very expensive valuation, with a 12.4 enterprise value to capital employed and a PEG ratio of 27.9. This is significantly higher than its average historical valuations. Despite its size, domestic mutual funds hold only 0% of the company, indicating a lack of confidence in the stock.

In conclusion, while Race Eco Chain has shown promising growth and market performance, its management efficiency and high valuation are areas of concern. Investors are advised to hold the stock and monitor its performance closely.