Bambino Agro Industries downgraded to 'Sell' by MarketsMOJO due to high debt and poor growth

Bambino Agro Industries ., a microcap FMCG company, has recently been downgraded to a 'Sell' by MarketsMOJO. This decision was based on several factors, including the company's high debt to EBITDA ratio of 3.59 times, indicating a low ability to service debt. Additionally, the company has shown poor long-term growth with only a 7.68% increase in net sales and a 9.87% increase in operating profit over the last 5 years.
In December 2023, the company's profits fell by -31.6%, with a PAT(Q) of Rs 1.21 crore. This has contributed to the stock's technical trend being in a mildly bearish range, with a -8.92% return since March 2024. The MACD and Bollinger Band technical factors also suggest a bearish trend for the stock.

Furthermore, Bambino Agro Industries has underperformed the market in the last year, with negative returns of -3.78% compared to the BSE 500's 36.59% returns. However, the company does have a fair valuation with a ROCE of 11.4 and an enterprise value to capital employed ratio of 1.9. It is also currently trading at a discount compared to its historical valuations.

It is worth noting that the majority shareholders of Bambino Agro Industries are the promoters of the company. While the stock has generated negative returns in the past year, the company's profits have increased by 4%, resulting in a PEG ratio of 8.3. Overall, MarketsMOJO's downgrade to 'Sell' for Bambino Agro Industries is based on the company's financial performance and technical trends, and investors should carefully consider these factors before making any investment decisions.