Sumedha Fiscal Services Receives 'Hold' Rating After Strong Quarterly Results

Sumedha Fiscal Services, a microcap finance company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company declared very positive results for the last four consecutive quarters, with a growth in net sales of 63.27% in March 2024. The company's net sales for the first nine months of the fiscal year were also higher at Rs 78.77 crore, with a PAT of Rs 5.55 crore.
Technically, the stock is currently in a mildly bullish range and the trend has improved from sideways on 25th June 2024. A key technical factor, the Bollinger Band, has been bullish since the same date. With a ROE of 13.3, the company has a very attractive valuation with a price to book value of 0.7. It is also trading at a fair value compared to its average historical valuations. In the past year, the stock has generated a return of 12.40%, while its profits have risen by 400.7%. The PEG ratio of the company is 0, indicating a good value for investors.

However, Sumedha Fiscal Services does have some weak long-term fundamental strength, with an average ROE of 7.68%. Its operating profit has also shown poor growth at an annual rate of -26.55%. In the last year, the stock has underperformed the market, generating a return of 12.40% compared to the market's return of 39.00% (BSE 500).

The majority shareholders of Sumedha Fiscal Services are non-institutional investors, which may indicate a lack of confidence from larger investors. Overall, while the company has shown positive results in the recent past, its long-term fundamentals and market performance may be cause for concern. Investors are advised to hold onto their positions for now and monitor the company's performance closely.