Inter State Oil Carrier Receives 'Hold' Rating from MarketsMOJO After Positive Results and Bullish Technical Indicators

Inter State Oil Carrier, a microcap logistics company, has recently received a 'Hold' rating from MarketsMOJO on May 21, 2024. This upgrade comes after the company reported positive results in December 2023, with a 590.91% growth in PAT (9M) at Rs 1.08 crore and higher net sales (9M) at Rs 59.48 crore.
Technically, the stock is currently in a Mildly Bullish range, with the technical trend improving from Mildly Bearish on May 18, 2024. Multiple factors such as MACD, Bollinger Band, and KST indicate a bullish outlook for the stock.

Attractive valuation is another factor contributing to the 'Hold' rating, with a ROCE of 5.8 and an enterprise value to capital employed ratio of 1.1. The stock is currently trading at a discount compared to its average historical valuations. However, it is important to note that while the stock has generated a return of 66.64% in the past year, its profits have declined by -42.5%.

The majority of the company's shareholders are non-institutional investors. Inter State Oil Carrier has consistently delivered strong returns over the last three years, outperforming the BSE 500 index in each of the last three annual periods.

On the other hand, the company's long-term fundamental strength is weak, with a -12.68% CAGR growth in operating profits over the last five years. Additionally, the company has a high debt to EBITDA ratio of 4.38 times, indicating a low ability to service debt. The return on equity (average) of 7.44% also signifies low profitability per unit of shareholders' funds.

In conclusion, while Inter State Oil Carrier has shown positive growth in recent months and has attractive valuation metrics, its long-term fundamental strength and debt levels raise some concerns. Investors may want to hold onto their positions for now and monitor the company's performance closely.