Chartered Logistics Receives 'Sell' Rating Due to Weak Fundamentals and High Debt

Chartered Logistics, a microcap logistics company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is based on the company's weak long-term fundamental strength, with a -9.36% CAGR growth in operating profits over the last 5 years. Additionally, the company has a high debt to EBITDA ratio of 9.61 times, indicating a low ability to service debt. Furthermore, the company has only been able to generate a return on equity of 1.83%, which is a sign of low profitability per unit of shareholders' funds.
Despite some positive results in June 2024, such as a higher PAT of Rs 2.27 crore and the highest net sales and PBDIT in the quarter, the stock is currently in a mildly bullish range. However, there are multiple bullish factors for the stock, including MACD, KST, and OBV. With a ROCE of 2.5, the stock is fairly valued with a 1.9 enterprise value to capital employed. However, it is currently trading at a premium compared to its average historical valuations.

In the past year, the stock has generated a return of 99.61%, outperforming the market (BSE 500) returns of 31.91%. This market-beating performance may be attributed to the majority shareholders being non-institutional investors. It is important to note that this stock is not recommended for investment, as it has been downgraded to 'Sell' by MarketsMOJO. Investors should carefully consider the company's weak fundamental strength and high debt before making any investment decisions.