SAL Automotive Receives 'Sell' Rating from MarketsMOJO Due to Poor Growth and Negative Results

SAL Automotive, a microcap company in the auto ancillary industry, has recently received a 'Sell' rating from MarketsMOJO on July 15, 2024. This downgrade is based on the company's poor long-term growth, with operating profit only growing at an annual rate of 14.60% over the last 5 years.
In addition, SAL Automotive has recently declared negative results for the first time in 7 consecutive quarters, with a decline of -48.45% in its PAT (HY) at Rs 1.83 crore and the lowest NET SALES (Q) at Rs 60.78 crore.

Technically, the stock is currently in a Mildly Bearish range, with the technical trend deteriorating from Mildly Bullish on July 15, 2024. This has resulted in a -4.72% return since then. Another key technical factor, the Bollinger Band, has been Bearish since July 15, 2024.

Other factors contributing to the 'Sell' rating include a ROCE of 13.9, which indicates an attractive valuation with a 2.4 Enterprise value to Capital Employed. The stock is also currently trading at a discount compared to its average historical valuations. However, despite generating a return of 29.62% in the past year, the company's profits have only risen by 8.5%, resulting in a PEG ratio of 2.8.

It is worth noting that the majority shareholders of SAL Automotive are the promoters themselves. This may raise concerns about potential conflicts of interest and their impact on the company's performance.

Overall, with a 'Sell' rating from MarketsMOJO and various factors indicating a decline in performance, investors may want to approach SAL Automotive with caution.