Deepak Fertilizers & Petrochemicals Corp downgraded to 'Hold' by MarketsMOJO

Deepak Fertilizers & Petrochemicals Corp, a midcap company in the fertilizer industry, has recently been downgraded to a 'Hold' by MarketsMOJO on October 14, 2024. This decision was based on various factors, including the company's high management efficiency with a ROCE of 15.22% and healthy long-term growth with an annual operating profit growth rate of 34.58%.
The stock is currently in a mildly bullish range, with multiple factors such as MACD, KST, DOW, and OBV indicating a bullish trend. Additionally, the stock is trading at a discount compared to its average historical valuations, making it a fair valuation with a 1.9 Enterprise value to Capital Employed.

However, despite generating a return of 59.66% in the past year, the company's profits have fallen by -40.4%. This could be a cause for concern for investors. On a positive note, mutual funds have increased their holdings in the company, now holding 4.04% of the company.

Deepak Fertilizers & Petrochemicals Corp has a market-beating performance in the long term as well as the near term, outperforming BSE 500 in the last 3 years, 1 year, and 3 months.

On the downside, the company has a low ability to service debt with a high Debt to EBITDA ratio of 2.73 times. This could potentially impact the company's financial stability.

In the latest financial results for June 2024, the company has reported flat results with a -20.90% growth in net sales and a -23.84% growth in PAT. However, the interest has increased by 36.13%.

Overall, while Deepak Fertilizers & Petrochemicals Corp has shown strong management efficiency and long-term growth potential, the recent decline in profits and high debt to EBITDA ratio may have led to the downgrade to a 'Hold' by MarketsMOJO. Investors should carefully consider these factors before making any investment decisions.