SEPC Receives 'Hold' Rating from MarketsMOJO After Positive Results and Bullish Trend Indicators

SEPC, a smallcap company in the capital goods industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company declared very positive results in June 2024, with a growth in operating profit of 27.85%. SEPC has also shown consistent positive results for the last two consecutive quarters, with a highest debtors turnover ratio of 1.87 times and operating profit to interest ratio of 1.92 times.
Technically, the stock is currently in a bullish range and has shown a significant improvement since August 2024, generating a return of 12.51%. Multiple factors, such as MACD, Bollinger Band, and KST, indicate a bullish trend for the stock.

SEPC has also shown consistent returns over the last three years, outperforming BSE 500 in each of the last three annual periods and generating a return of 86.33% in the last year. However, the company's long-term fundamental strength is weak, with a negative CAGR growth in operating profits of -231.87% over the last five years. Additionally, the company has a high debt to EBITDA ratio of -1.00 times, indicating a low ability to service debt.

The company's return on equity (avg) is also low at 0.48%, signifying low profitability per unit of shareholders' funds. With a ROCE of 1.3, the stock is currently very expensive, with an enterprise value to capital employed ratio of 2.8. However, the stock is currently trading at a discount compared to its average historical valuations.

It is worth noting that 33.95% of promoter shares are pledged, which could put additional downward pressure on the stock prices in falling markets. The proportion of pledged holdings has also increased by 26.06% over the last quarter.

Overall, while SEPC has shown positive results in the short term, its long-term fundamental strength and high promoter pledged shares should be considered before making any investment decisions. MarketsMOJO's 'Hold' rating reflects a neutral stance on the stock, and investors should carefully evaluate all factors before making any decisions.