Agarwal Industrial Corporation Receives 'Buy' Rating from MarketsMOJO, Shows Strong Growth and Attractive Valuation

Agarwal Industrial Corporation, a smallcap company in the petrochemical industry, has recently received a 'Buy' rating from MarketsMOJO on June 26, 2024. This upgrade is based on several positive factors that make the stock a promising investment opportunity.
One of the key reasons for the 'Buy' rating is the company's strong ability to service debt, with a low Debt to EBITDA ratio of 1.25 times. This indicates that the company is financially stable and has the capacity to handle its debt obligations.

Moreover, Agarwal Industrial Corporation has shown healthy long-term growth, with its Net Sales growing at an annual rate of 31.94% and Operating profit at 40.77%. In the latest quarter, the company achieved its highest NET SALES(Q) at Rs 776.44 cr, PBDIT(Q) at Rs 60.14 cr, and PBT LESS OI(Q) at Rs 41.85 cr.

From a technical standpoint, the stock is currently in a Bullish range and has shown improvement since June 26, 2024. Multiple technical indicators such as MACD, Bollinger Band, KST, DOW, and OBV are also signaling a bullish trend for the stock.

In terms of valuation, Agarwal Industrial Corporation is trading at a discount compared to its average historical valuations. With a ROCE of 18.4 and a PEG ratio of 0.9, the stock is considered to be very attractive in terms of valuation.

The company has also consistently delivered strong returns over the last 3 years, outperforming the BSE 500 index. In the past year alone, the stock has generated a return of 94.90%, while its profits have increased by 18.4%.

With a market cap of Rs 1,772 cr, Agarwal Industrial Corporation is the biggest company in the petrochemical sector, constituting 25.01% of the entire industry. Its annual sales of Rs 2,125.29 cr also account for 31.89% of the industry.

However, it is important to note that despite its size, domestic mutual funds hold only 0% of the company. This could be a potential risk as it may indicate that they are not comfortable with the stock's current price or the business itself.

In conclusion, Agarwal Industrial Corporation is a promising investment opportunity in the petrochemical industry, with strong financials, consistent growth, and attractive valuation. However, investors should also consider the potential risks associated with the stock.