Zenotech Laboratories Receives 'Sell' Rating After Negative Q1 Results

Zenotech Laboratories, a microcap pharmaceutical company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade comes after the company reported negative results in the quarter ending March 2024. The company's profits have fallen by -76.6% to Rs 0.66 crore, with the lowest net sales and PBDIT at Rs 9.11 crore and Rs 2.78 crore respectively.
The stock is currently in a Mildly Bearish range and has seen a deterioration in its technical trend since May 9, 2024, resulting in a -2.85% return. Multiple factors, such as MACD, Bollinger Band, and KST, indicate a bearish outlook for the stock.

With a ROE of 9.2, the stock is currently trading at a Very Expensive valuation with a 4.1 Price to Book Value. However, it is currently trading at a discount compared to its average historical valuations. Despite generating a return of 12.26% in the past year, the company's profits have fallen by -28.5%.

In the last year, Zenotech Laboratories has underperformed the market, with a return of 12.26% compared to the market's (BSE 500) return of 31.00%. However, the company has shown high management efficiency with a ROE of 15.59% and has a strong ability to service debt with a low Debt to EBITDA ratio of 1.29 times.

The majority shareholders of Zenotech Laboratories are its promoters, indicating their confidence in the company's future prospects. However, based on the recent downgrade and negative financial results, investors may want to approach this stock with caution.