Empower India Receives 'Hold' Rating from MarketsMOJO Based on Current Performance and Financials

Empower India, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO on September 2, 2024. This downgrade is based on the company's current performance and financials.
Despite a healthy long-term growth rate, with net sales increasing by 328.50% and operating profit by 120.91%, the company's net profit has only grown by 22.72%. However, Empower India did declare positive results for the last four consecutive quarters, with PBT LESS OI(Q) growing at 124.3% and PAT(HY) at Rs 4.62 crore.

Technically, the stock is currently in a mildly bullish range, with the key technical factor KST being bullish since August 30, 2024. The company also has a fair valuation with a price to book value of 0.9 and a return on equity of 2.3.

However, the stock is currently trading at a premium compared to its average historical valuations. In the past year, the stock has generated a return of 196.15%, while its profits have only risen by 676%. This results in a PEG ratio of 0, indicating that the stock may be overvalued.

Empower India's majority shareholders are non-institutional investors, and the stock has outperformed the market (BSE 500) with a return of 196.15% in the last year.

On the other hand, the company's management efficiency is poor, with a low return on equity of 0.16%. This signifies low profitability per unit of shareholders' funds. Additionally, Empower India has a high debt to EBITDA ratio of 10.20 times, indicating a low ability to service debt.

In conclusion, while Empower India has shown strong growth potential, its current financials and management efficiency may warrant a 'Hold' rating for now. Investors should closely monitor the company's performance in the future before making any investment decisions.