Graviss Hospitality Receives 'Hold' Rating from MarketsMOJO, Strong Performance but Weak Fundamentals

Graviss Hospitality, a microcap company in the hotel industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade is based on several factors, including the company's high debtors turnover ratio of 217.84 times and its strong PBDIT (profit before depreciation, interest, and taxes) of Rs 5.68 crore. Additionally, the company's operating profit to net sales ratio is at a high of 34.74%.
Technically, the stock is currently in a bullish range and has shown improvement from a mildly bullish trend on 28th March 2024. This is supported by various indicators such as MACD, Bollinger Band, and KST.

The majority shareholders of Graviss Hospitality are its promoters, which can be seen as a positive sign for the company. It has also consistently generated good returns over the last three years, outperforming the BSE 500 index.

However, the company's long-term fundamental strength is weak, with an average return on equity (ROE) of only 0.66%. Its net sales have also shown poor growth, increasing by only 2.56% annually over the last five years. Furthermore, the company's ability to service its debt is weak, with a poor EBIT (earnings before interest and taxes) to interest ratio of -4.95.

Despite its high ROE of 2.3, the stock is currently trading at an expensive valuation with a price to book value of 2. However, it is still at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 136.44%, while its profits have risen by 550%. This gives the company a PEG (price/earnings to growth) ratio of 0, indicating that it may be undervalued.

Overall, while Graviss Hospitality has shown strong performance in the past year, its long-term fundamentals and valuation may be cause for concern. Investors are advised to hold onto their positions for now and monitor the company's performance closely.