Bengal & Assam Company: Strong Financial Performance

Bengal & Assam Company, a midcap finance/NBFC company, has recently caught the attention of investors with its strong long-term fundamental strength. MarketsMOJO has upgraded its stock call to 'Buy' on 2023-08-11, citing multiple positive factors.
One of the key reasons for the 'Buy' call is the company's average Return on Equity (ROE) of 15.28%, which indicates a strong financial performance. In fact, the company has declared very positive results in September 2023, with a growth in net profit of 206.25%. This trend has been consistent for the last 6 consecutive quarters, showcasing the company's stability and growth potential.

Moreover, Bengal & Assam Company has a low debt-to-equity ratio of 0.78 times, indicating a healthy balance sheet. Its operating profit to net sales ratio is also the highest at 15.53%, further highlighting its strong financials.

From a technical standpoint, the stock is currently in a bullish range and has shown a significant improvement since August 2023, generating 62.25% returns. This is supported by factors such as MACD, KST, and DOW, all of which are bullish for the stock.

In addition to its financial performance, Bengal & Assam Company has consistently outperformed BSE 500 in the last 3 years, generating a return of 101.20%. This showcases the company's consistent growth and potential for future returns.

However, it's important to note the potential risks associated with investing in this stock. With an ROE of 18.8, the company has a relatively expensive valuation with a price-to-book value of 1.5. Additionally, while the stock has generated a high return in the past year, its profits have only increased by 44.4%, resulting in a low PEG ratio of 0.2.

Furthermore, despite its midcap size, domestic mutual funds hold only 0.01% of the company, which could indicate a lack of confidence in the stock or the business. This is something investors should consider before making any investment decisions.

Overall, Bengal & Assam Company has shown strong financial performance and has the potential for future growth. However, investors should carefully consider the risks associated with the stock before making any investment decisions.