India Motor Parts & Accessories Downgraded to 'Sell' by MarketsMOJO, Concerns Over Long-Term Growth and Low Mutual Fund Interest

India Motor Parts & Accessories, a smallcap trading company, has recently been downgraded to a 'Sell' by MarketsMOJO on April 15, 2024. This decision was based on the company's poor long-term growth, with net sales growing at an annual rate of 7.69% and operating profit at 10.53% over the last 5 years. In addition, the company's results in December 2023 showed a decline in PBT LESS OI(Q) at Rs 13.21 crore, a decrease of -11.22%, and a low DEBTORS TURNOVER RATIO(HY) at 6.68 times. PBDIT(Q) was also at its lowest at Rs 13.51 crore. Despite being a smallcap company, India Motor Parts & Accessories has not attracted much interest from domestic mutual funds, with only 0% of the company's shares held by them. This could indicate that either they are not comfortable with the current price or they have concerns about the company's business. On the positive side, the company has a low Debt to Equity ratio (avg) at 0 times and its stock is currently in a Mildly Bullish range. Technical indicators such as MACD, Bollinger Band, KST, and OBV also suggest a bullish trend for the stock. However, with a ROE of 4.4, the company's valuation is considered fair with a price to book value of 0.7. The stock is currently trading at a premium compared to its average historical valuations. In the past year, the stock has generated a return of 59.45%, outperforming the market (BSE 500) returns of 36.05%. However, the company's profits have only increased by 10.6%, resulting in a PEG ratio of 1.5. In conclusion, while India Motor Parts & Accessories has shown market-beating performance in the past year, the company's long-term growth and low interest from domestic mutual funds may be cause for concern. Investors are advised to carefully consider all factors before making any investment decisions.