Anuh Pharma downgraded to 'Sell' by MarketsMOJO after negative results and lack of interest from domestic mutual funds

Anuh Pharma, a microcap pharmaceutical company, has recently been downgraded to a 'Sell' by MarketsMOJO on October 7, 2024. This downgrade comes after the company reported negative results in June 2024, breaking a streak of four consecutive positive quarters. The company's profits after tax have fallen by 36.7% to Rs 9.51 crore, and its operating cash flow has also decreased to its lowest at Rs 12.93 crore. Additionally, the dividend payout ratio has also dropped to its lowest at 20.86%.
One of the reasons for this downgrade could be the fact that despite being a microcap company, domestic mutual funds hold only 0% of the company. This could indicate that either the mutual funds are not comfortable with the company's current price or its business. Domestic mutual funds have the capability to conduct in-depth research on companies, and their small stake in Anuh Pharma may be a cause for concern.

On the positive side, Anuh Pharma has a low debt to equity ratio of 0 times, which is below the industry average. However, the technical trend for the stock is currently sideways, indicating no clear price momentum. The technical trend has also deteriorated from mildly bullish on October 7, 2024, and has generated a negative return of -4.77% since then.

Despite these factors, Anuh Pharma has a very attractive valuation with a price to book value of 3.3 and a return on equity of 19.9%. The stock is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 48.44%, outperforming the market (BSE 500) returns of 33.39%. The company's profits have also increased by 42.4%, resulting in a PEG ratio of 0.4.

In conclusion, while Anuh Pharma may have been downgraded to a 'Sell' by MarketsMOJO, it is important to consider all factors before making any investment decisions. The company's low debt to equity ratio and attractive valuation could still make it a potential investment opportunity. However, the recent negative results and lack of interest from domestic mutual funds should also be taken into consideration.