Sahyadri Industries Downgraded to 'Sell' by MarketsMOJO Due to Poor Long-Term Growth

Sahyadri Industries, a microcap company in the construction material industry, has recently been downgraded to a 'Sell' by MarketsMOJO on July 16, 2024. This decision was based on the company's poor long-term growth, as its operating profit has declined by an annual rate of -1.11% over the last 5 years. Additionally, the company has declared negative results for the last 10 consecutive quarters, with a decrease in PBT LESS OI(Q) at Rs 4.52 crore by -23.39% and an increase in INTEREST(HY) at Rs 6.20 crore by 21.81%. Furthermore, the company's net sales have also decreased by -7.83%.
In the past year, Sahyadri Industries has underperformed the market, generating a return of only 9.71%, compared to the market's return of 37.74% (BSE 500). However, the company does have a strong ability to service debt, with a low Debt to EBITDA ratio of 0.61 times. The technical trend for the stock is currently sideways, indicating no clear price momentum. The stock's technical trend has also deteriorated from Mildly Bullish on July 16, 2024, and has generated a return of -1.07% since then.

On a positive note, Sahyadri Industries has an attractive valuation with a ROCE of 9.3 and a 1.2 Enterprise value to Capital Employed. The stock is currently trading at a discount compared to its average historical valuations. However, despite generating a return of 9.71% in the past year, the company's profits have fallen by -29%.

It is worth noting that the majority shareholders of Sahyadri Industries are its promoters. This information may be important for investors to consider when making decisions about the company's stock. Overall, with its recent downgrade to 'Sell' and poor long-term growth, investors may want to approach Sahyadri Industries with caution.