Hariyana Ship Breakers Receives 'Sell' Rating from MarketsMOJO, Citing Weak Fundamentals and High Risk

Hariyana Ship Breakers, a microcap trading company, has recently received a 'Sell' rating from MarketsMOJO on January 17, 2024. This downgrade is based on the company's weak long-term fundamental strength, poor ability to service its debt, and low profitability per unit of shareholders' funds.
One of the main reasons for the 'Sell' rating is the company's -121.77% CAGR growth in operating profits over the last 5 years. This indicates a decline in the company's financial performance. Additionally, the company's EBIT to Interest (avg) ratio of 0.91 is a cause for concern as it suggests a weak ability to pay off its debt.

Moreover, the stock is considered risky due to its negative EBITDA and trading at higher valuations compared to its historical average. Although the stock has generated a return of 61.22% in the past year, its profits have only risen by 328.1%, resulting in a PEG ratio of 0.

On a positive note, the company has shown a growth in net sales of 60.89% and declared very positive results in September 2023. Its net sales for the quarter were the highest at Rs 90.84 crore, while PBT LESS OI(Q) and PAT(Q) were also at their highest at Rs 3.66 crore and Rs 5.92 crore, respectively.

From a technical standpoint, the stock is currently in a mildly bullish range with its MACD and KST technical factors also showing a bullish trend.

It is worth noting that the majority shareholders of Hariyana Ship Breakers are promoters, which could potentially impact the company's decision-making and direction.

Despite its recent market-beating performance, with a return of 61.22% in the last year and outperforming BSE 500 in the last 3 years, 1 year, and 3 months, MarketsMOJO has downgraded the stock to 'Sell' due to its weak long-term fundamentals and high risk. Investors should carefully consider these factors before making any investment decisions.