Harrisons Malayalam Upgraded to 'Hold' by MarketsMOJO, Showing Strong Growth and Market Performance

Harrisons Malayalam, a microcap company in the tea/coffee industry, has recently been upgraded to a 'Hold' by MarketsMOJO on November 14, 2024. This upgrade is based on the company's healthy long-term growth, with an annual operating profit growth rate of 35.85%. Additionally, the stock is currently in a bullish range and has shown a positive technical trend since September 30, 2024, generating 8.16% returns.
In terms of market performance, Harrisons Malayalam has outperformed the BSE 500 index in the last 3 years, 1 year, and 3 months, with a return of 83.12% in the last year alone. However, the company has a high debt to EBITDA ratio of 11.92 times, indicating a low ability to service debt.

The company also reported negative results in June 2024, with a 20% decrease in net sales and a significant decline in profits. Its return on capital employed (ROCE) for the first half of the year was also at its lowest at 5.55%. With a ROCE of 1.9, the stock is currently trading at a very expensive valuation, with an enterprise value to capital employed ratio of 2.5.

Despite its strong market performance, domestic mutual funds hold only 0.08% of the company, which may indicate their discomfort with the stock's current price or business. This is surprising given the company's size and the capability of mutual funds to conduct in-depth research on companies.

In conclusion, while Harrisons Malayalam has shown promising growth and a positive technical trend, its high debt and expensive valuation may be a cause for concern. Investors are advised to hold onto their positions and monitor the company's performance closely.