Alphageo (India) Shows Positive Results, MarketsMOJO Upgrades Stock Call to 'Hold'

Alphageo (India) is a microcap company in the oil exploration/refineries industry. Recently, MarketsMOJO upgraded their stock call on the company to 'Hold' on November 12, 2024.
The company has shown positive results for the last four consecutive quarters, with a significant growth in net sales of 482.89% at Rs 43.95 crore and a higher PAT of Rs 5.52 crore in the half-yearly results. Additionally, their ROCE (Return on Capital Employed) is at its highest at 8.97%.

Technically, the stock is in a mildly bullish range and both the MACD and KST technical factors are also bullish. With an ROE (Return on Equity) of 6.3, the company has an attractive valuation with a price to book value of 0.8. However, it is currently trading at a premium compared to its average historical valuations.

In the past year, the stock has generated a return of 28.40%, while its profits have risen by 606.8%. This gives the company a PEG (Price/Earnings to Growth) ratio of 0, indicating a potential undervaluation.

The majority shareholders of Alphageo (India) are non-institutional investors. However, the company has weak long-term fundamental strength with a -173.67% CAGR growth in operating profits over the last five years. Additionally, their ability to service debt is weak with a poor EBIT (Earnings Before Interest and Taxes) to Interest ratio of -0.09. The company's return on equity is also low at 5.83%, indicating low profitability per unit of shareholders' funds.

In conclusion, while Alphageo (India) has shown positive results in the recent past and has a potential for undervaluation, it also has weak long-term fundamentals and low profitability. Therefore, MarketsMOJO has upgraded their stock call to 'Hold' for now.