CIE Automotive India Downgraded to 'Sell' by MarketsMOJO, Poor Growth and Technical Factors Cited

CIE Automotive India, a midcap company in the castings/forgings industry, has recently been downgraded to a 'Sell' by MarketsMOJO on October 22, 2024. This decision was based on several factors, including poor long-term growth with only a 2.24% annual increase in net sales and a 7.17% increase in operating profit over the last 5 years.
Technically, the stock is currently in a Mildly Bearish range, with a deteriorating trend since October 22, 2024, resulting in a -3.68% return. The Bollinger Band, a key technical factor, has also been Bearish since the same date.

In the past year, CIE Automotive India has underperformed the market, with a return of only 12.59% compared to the market's 31.91% return. However, the company has a strong ability to service debt with a low Debt to EBITDA ratio of 1.14 times.

In June 2024, the company reported positive results, with the highest operating cash flow of Rs 1,383.26 crore and a 55.67% growth in PAT (9M). The operating profit to interest ratio was also at its highest at 17.07 times.

With a ROE of 13.9, the company has an attractive valuation with a 3.1 price to book value. It is currently trading at a discount compared to its average historical valuations. Additionally, while the stock has generated a return of 12.59% in the past year, its profits have increased by 51.3%, resulting in a low PEG ratio of 0.4.

Furthermore, CIE Automotive India has a high institutional holding of 24.7%, indicating that these investors have better capabilities and resources to analyze the company's fundamentals compared to retail investors.

In conclusion, based on the recent downgrade and various factors, it may be wise for investors to consider selling their stocks in CIE Automotive India. However, it is important to conduct further research and analysis before making any investment decisions.