Federal-Mogul Goetze (India) upgraded to 'Hold' by MarketsMOJO, but concerns remain

Federal-Mogul Goetze (India) is a smallcap company in the auto ancillary industry. Recently, MarketsMOJO has upgraded its stock call to 'Hold' on May 14, 2024. This decision is based on various factors such as the company's low Debt to Equity ratio, technical trend showing no clear price momentum, and attractive valuation with a 2 Price to Book Value and ROE of 11.4.
Despite the stock generating a return of 14.78% in the past year, its profits have risen by 31.6%, resulting in a PEG ratio of 0.6. However, the company has shown poor long-term growth with an annual rate of -2.01% in operating profit over the last 5 years.

In the latest quarter, the company's results were flat with PBDIT(Q) at its lowest at Rs 47.60 crore and OPERATING PROFIT TO NET SALES (Q) at its lowest at 11.48%. PBT LESS OI(Q) was also at its lowest at Rs 25.08 crore.

Institutional investors have also decreased their stake in the company by -0.52% over the previous quarter, holding only 1.07% collectively. This could be a cause for concern as institutional investors have better resources to analyze company fundamentals.

In the last 1 year, Federal-Mogul Goetze (India) has underperformed the market with a return of 14.78%, compared to the market (BSE 500) returns of 32.70%. Overall, while the company's stock has shown some positive returns, it is important to consider its poor long-term growth and decreasing interest from institutional investors before making any investment decisions.