Southern Infosys Receives Upgraded Stock Call from MarketsMOJO, Showing Positive Growth and Improvement

Southern Infosys, a microcap IT software company, has recently received an upgraded stock call from MarketsMOJO. The stock has been upgraded to 'Hold' on September 17, 2024.
The decision to upgrade the stock is based on the company's positive results in June 2024. The company's net sales have grown by 31.06% to Rs 10.17 crore, while its PAT has increased to Rs 0.24 crore. Additionally, the company's ROCE has reached its highest at 5.27%.

Technically, the stock is in a bullish range and the technical trend has improved from mildly bullish on September 17, 2024. Multiple factors such as MACD, Bollinger Band, KST, and OBV are also indicating a bullish trend for the stock.

The majority shareholders of Southern Infosys are its promoters, which is a positive sign for the company. The stock has also outperformed the market (BSE 500) with a return of 75.51% in the last year, compared to the market's return of 34.98%.

However, the company's long-term fundamental strength is weak with a -4.17% CAGR growth in operating profits over the last 5 years. Its ability to service its debt is also weak with a poor EBIT to Interest (avg) ratio of -0.19. The company has also reported losses, resulting in a negative ROCE.

With an ROE of 4.7, the stock is currently trading at an expensive valuation with a price to book value of 2.4. However, it is still trading at a discount compared to its average historical valuations. Despite the stock's impressive return of 75.51% in the last year, its profits have only risen by 20%, resulting in a low PEG ratio of 0.1.

Overall, Southern Infosys is showing positive signs of growth and improvement, but it is important to consider its weak long-term fundamentals and expensive valuation before making any investment decisions.