Vishwaraj Sugar Industries Receives 'Sell' Rating from MarketsMOJO Due to Weak Performance and Fundamental Strength

Vishwaraj Sugar Industries, a microcap company in the sugar industry, has recently received a 'Sell' rating from MarketsMOJO on July 22, 2024. This downgrade is based on several factors that indicate weak long-term fundamental strength for the company.
One of the main reasons for the 'Sell' rating is the company's poor performance in terms of operating profits, with a -3.85% CAGR growth over the last 5 years. Additionally, Vishwaraj Sugar Industries has a high debt to EBITDA ratio of 4.45 times, indicating a low ability to service debt. The company's return on equity has also been low at 9.33%, suggesting low profitability per unit of shareholders' funds.

From a technical standpoint, the stock is currently in a Mildly Bearish range and has been generating negative returns since July 18, 2024. The Bollinger Band, a key technical factor, has also been Bearish since the same date.

Furthermore, Vishwaraj Sugar Industries has consistently underperformed against the benchmark BSE 500 index over the last 3 years. In the past year, the stock has generated -1.77% returns and has underperformed the index in each of the last 3 annual periods.

On a positive note, the company has shown growth in its financial results for the quarter ending March 2024. Its PBT LESS OI(Q) has grown by 191.9% and PAT(Q) has grown by 126.1%. With a ROCE of 6.8, the company has an attractive valuation with a 1.1 Enterprise value to Capital Employed. Additionally, the stock is currently trading at a discount compared to its average historical valuations.

It is worth noting that the majority of shareholders in Vishwaraj Sugar Industries are non-institutional investors. Overall, the recent downgrade to 'Sell' by MarketsMOJO highlights the weak performance and fundamental strength of the company, making it a risky investment option for potential investors.