Uniroyal Industries Receives 'Hold' Rating from MarketsMOJO, Strong Short-Term Performance Raises Concerns

Uniroyal Industries, a microcap textile company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes as the company's PBDIT(Q) reached its highest at Rs 2.54 crore, with an operating profit to net sales(Q) of 10.62% and PBT less OI(Q) at Rs 1.50 crore.
Technically, the stock is in a mildly bullish range and its MACD and KST technical factors are also bullish. Additionally, with a ROCE of -0, the company has an attractive valuation with a 1 Enterprise value to Capital Employed. The stock is currently trading at a discount compared to its average historical valuations.

Over the past year, Uniroyal Industries has outperformed the market (BSE 500) with a return of 62.04%. Its profits have also seen a significant increase of 47%, resulting in a low PEG ratio of 0.1.

The majority shareholders of the company are the promoters, indicating their confidence in the company's performance. However, the company's long-term fundamental strength is weak with a -34.43% CAGR growth in operating profits over the last 5 years. It also has a high debt to EBITDA ratio of 4.66 times, indicating a low ability to service debt.

In terms of profitability, Uniroyal Industries has a low return on equity (avg) of 4.17%, indicating low profitability per unit of shareholders' funds. Overall, while the stock has shown strong market-beating performance in the past year, its long-term fundamentals and debt situation may be cause for concern. Investors are advised to hold onto their positions for now.