TFCI's Stock Upgraded to 'Hold' by MarketsMOJO, Institutional Investors Show Interest

Tourism Finance Corporation of India (TFCI) has recently caught the attention of investors as its stock call has been upgraded to 'Hold' by MarketsMOJO on March 5, 2024. This smallcap company in the finance/NBFC industry has shown a technically bullish trend and has generated a return of -3.44% since the upgrade.
One of the reasons for the upgrade is the increasing participation of institutional investors in the company. In the previous quarter, these investors have increased their stake by 0.88% and now collectively hold 13.89% of the company. This is a positive sign as institutional investors have better resources and capabilities to analyze the fundamentals of a company.

Moreover, TFCI has also shown a market-beating performance in the long term as well as the near term. In the last 1 year, the stock has generated a return of 205.29% and has outperformed BSE 500 in the last 3 years, 1 year, and 3 months.

However, the company has shown poor long-term growth as its operating profit has only grown at an annual rate of 1.29%. In addition, the company's results for December 2022 were negative with a fall in PAT (Q) at Rs 18.38 crore and a decrease in NET SALES (Q) at Rs 51.00 crore. The PBT LESS OI (Q) has also fallen at -9.1%.

With a ROE of 10.1, TFCI has a very expensive valuation with a price to book value of 2.1. The stock is currently trading at a premium compared to its average historical valuations. While the stock has shown a significant return in the past year, its profits have only risen by 11.8%, resulting in a PEG ratio of 1.8.

In conclusion, while TFCI has shown a technically bullish trend and has caught the attention of investors, its poor long-term growth and expensive valuation may be a cause for concern. Investors are advised to hold onto their positions and closely monitor the company's performance in the future.