Bajaj Hindusthan Sugar Receives 'Hold' Rating After Positive Results and Bullish Trend Indicators

Bajaj Hindusthan Sugar, a midcap company in the sugar industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company's positive results in June 2024, with a higher PAT (HY) of Rs 35.18 crore and a lowest DEBT-EQUITY RATIO (HY) of 0.86 times.
Technically, the stock is currently in a bullish range and the trend has improved from mildly bullish on 30-Aug-24. Multiple factors such as MACD, Bollinger Band, and KST are also indicating a bullish trend for the stock.

With a ROCE of 0.3, the stock is fairly valued with an enterprise value to capital employed ratio of 1.1. It is also trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 74.60%, while its profits have risen by 58.8%.

Bajaj Hindusthan Sugar has also shown market-beating performance in the long term as well as the near term. Along with generating 74.60% returns in the last year, the stock has outperformed BSE 500 in the last 3 years, 1 year, and 3 months.

However, the company has weak long-term fundamental strength with a -14.28% CAGR growth in operating profits over the last 5 years. It also has a low ability to service debt, with a high debt to EBITDA ratio of 18.74 times. The company has also reported losses, resulting in a negative ROE.

Investors should also note that 100% of the promoter shares are pledged, which can put additional downward pressure on the stock prices in falling markets. Overall, while the stock has shown positive performance in the short term, its long-term fundamentals may need to be closely monitored.