Disha Resources Downgraded to 'Sell' by MarketsMOJO, Weak Fundamentals and Expensive Valuation Cited

Disha Resources, a microcap company in the finance/NBFC industry, has recently been downgraded to a 'Sell' by MarketsMOJO on August 17, 2024. This decision was based on the company's weak long-term fundamental strength, as it has been operating at a loss and has shown poor growth with only a 4.90% annual increase in operating profit.
In addition, the company's recent financial results for June 2024 have been flat, with the lowest PBT LESS OI(Q) at Rs -0.09 crore and EPS(Q) at Rs -0.08. This, combined with a ROE of 1.6 and an expensive valuation with a 0.4 price to book value, makes the stock less attractive to investors.

Despite the stock's recent return of 146.38%, its profits have actually decreased by -78.5% in the past year. However, the stock is currently trading at a fair value compared to its historical valuations.

On a positive note, the stock is technically in a bullish range and has shown improvement since August 8, 2024, generating a return of 9.5%. Multiple technical factors, such as MACD, Bollinger Band, and KST, also indicate a bullish trend for the stock.

It is worth noting that the majority of shareholders in Disha Resources are non-institutional investors. This could potentially lead to more volatility in the stock's performance.

Despite its recent downgrade, Disha Resources has shown market-beating performance in the long term, outperforming the BSE 500 index in the last 3 years, 1 year, and 3 months. However, with its current financial situation and valuation, it may be wise for investors to approach this stock with caution.