Shri Jagdamba Polymers Receives 'Buy' Rating from MarketsMOJO, Shows Strong Management Efficiency and Positive Q1 Results

Jul 09 2024 06:23 PM IST
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Shri Jagdamba Polymers, a microcap company in the packaging industry, has received a 'Buy' rating from MarketsMojo due to its strong management efficiency and ability to service debt. The company has shown positive results in the first quarter of 2024 and technical indicators point towards a positive trend. However, there are also risks to consider, such as poor long-term growth and an expensive valuation. Investors should carefully evaluate before investing.
Shri Jagdamba Polymers, a microcap company in the packaging industry, has recently received a 'Buy' rating from MarketsMOJO. This upgrade is based on the company's strong management efficiency, with a high ROCE of 39.48%, and its ability to service debt with a low Debt to EBITDA ratio of 0.31 times.

In addition, the company has shown positive results in the first quarter of 2024, with a growth of 61.96% in PAT(HY) at Rs 16.18 crore, and the highest NET SALES(Q) at Rs 109.99 crore and PBDIT(Q) at Rs 16.45 crore. The stock is also currently in a bullish range, with technical indicators such as MACD, Bollinger Band, and KST all pointing towards a positive trend.

It is worth noting that the majority shareholders of Shri Jagdamba Polymers are the promoters themselves, which can be seen as a vote of confidence in the company's future prospects.

However, there are also some risks to consider. The company has shown poor long-term growth, with a 5-year annual growth rate of only 13.78% in Net Sales and 7.64% in Operating profit. Additionally, with an ROE of 14.1, the stock is currently trading at an expensive valuation with a 3.4 Price to Book Value. Furthermore, the stock is currently trading at a premium compared to its historical valuations, and the PEG ratio of the company is 3.1, indicating a potentially overvalued stock.

Overall, Shri Jagdamba Polymers has shown promising growth and efficiency, but investors should also consider the potential risks before making any investment decisions.
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