Igarashi Motors India Receives 'Buy' Rating from MarketsMOJO, Shows Strong Debt Servicing Ability and Impressive Growth

Igarashi Motors India, a smallcap company in the auto ancillary industry, has recently received a 'Buy' rating from MarketsMOJO. This upgrade is based on the company's strong ability to service debt, with a low Debt to EBITDA ratio of 1.10 times. Additionally, the company has shown impressive growth in its Net Profit, with a 58.75% increase in Jun 24.
One of the key factors contributing to this positive rating is the company's highest Operating Profit to Net Sales(Q) at 11.40%, along with a PAT(Q) of Rs 8.16 cr. Furthermore, the company's Net Sales(Q) has grown at a rate of 22.5%, indicating a strong performance in the market.

From a technical standpoint, the stock is currently in a Bullish range and has shown improvement in its technical trend from Mildly Bullish on 16-Oct-24. Multiple factors such as MACD, Bollinger Band, KST, and OBV are also indicating a Bullish trend for the stock.

It is worth noting that the majority shareholders of Igarashi Motors India are the promoters, which can be seen as a positive sign for investors. However, there are some risks associated with the stock, such as poor long-term growth in Operating Profit, which has grown at an annual rate of -10.27% over the last 5 years.

Moreover, the company has an expensive valuation with a 4.2 Enterprise value to Capital Employed and is currently trading at a discount compared to its average historical valuations. Additionally, while the stock has generated a return of 15.98% in the last year, its profits have only risen by 50.1%, resulting in a PEG ratio of 2.7.

Despite these risks, Igarashi Motors India has underperformed the market in the last year, with a return of 15.98% compared to the market's (BSE 500) returns of 35.33%. However, with the recent 'Buy' rating from MarketsMOJO and the company's strong financial performance, it may be a good opportunity for investors to consider adding this stock to their portfolio.