Bambino Agro Industries Receives 'Sell' Rating from MarketsMOJO Due to High Debt and Poor Growth

Aug 05 2024 07:06 PM IST
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Bambino Agro Industries ., a microcap FMCG company, has received a 'Sell' rating from MarketsMojo due to its high debt to EBITDA ratio and poor long-term growth. Technical factors also indicate a Mildly Bearish outlook. Despite recent positive results, the company's underperformance and potential conflicts of interest with majority shareholders should be considered before investing.
Bambino Agro Industries ., a microcap FMCG company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is 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 5.93% annual growth in net sales and 9.87% in operating profit over the last 5 years.

Technically, the stock is currently in a Mildly Bearish range, with a deteriorating trend from Mildly Bullish on 30-Jul-24. The MACD and KST technical factors also suggest a Mildly Bearish outlook for the stock.

In the past year, Bambino Agro Industries . has underperformed the market, generating a return of 18.95% compared to the market's 32.89% return (BSE 500). This further supports the 'Sell' rating given by MarketsMOJO.

However, there have been some positive results for the company in March 2024, with PBT LESS OI(Q) growing at 425.00% and PAT(Q) growing at 171.9%. The company also has a fair valuation with a ROCE of 13.9 and an enterprise value to capital employed ratio of 2.2. It is currently trading at a discount compared to its average historical valuations.

It is worth noting that the majority shareholders of Bambino Agro Industries . are the promoters themselves. This may raise concerns about potential conflicts of interest and could be a factor in the company's underperformance.

In conclusion, while Bambino Agro Industries . has shown some positive results in the recent past, its overall financial health and technical trends suggest a 'Sell' rating from MarketsMOJO. Investors should carefully consider these factors before making any investment decisions.
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