International Conveyors Receives 'Hold' Rating Based on Strong Growth and Technical Trend

International Conveyors, a microcap engineering company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade is based on the company's healthy long-term growth, technical trend, and market-beating performance.
One of the key factors contributing to the 'Hold' rating is the company's strong operating profit growth, which has increased at an annual rate of 76.65%. Additionally, the stock is currently in a bullish range and has shown improvement in its technical trend.

Furthermore, multiple technical indicators such as MACD, Bollinger Band, and KST are also showing bullish signals for the stock. In the last year, the stock has generated a return of 73.15%, outperforming the market (BSE 500) returns of 36.71%.

However, there are some concerns regarding the company's ability to service debt, as it has a high debt to EBITDA ratio of 3.06 times. This may impact the company's profitability per unit of shareholders' funds, as indicated by its low return on equity of 9.21%.

Moreover, the company's financial results for December 2023 were negative, with a significant increase in interest expenses and a decline in net sales. The operating profit to interest ratio was also at its lowest at 1.67 times.

In terms of valuation, the stock is currently trading at a discount compared to its historical average. However, with a price to book value of 2.8 and a PEG ratio of 0.1, the stock may be considered expensive.

Another concerning factor is the decreasing stake of promoters in the company, which has decreased by -0.58% in the previous quarter. This may indicate a lack of confidence in the future prospects of the business.

In conclusion, while International Conveyors has shown strong growth and market-beating performance, there are some concerns regarding its debt and profitability. The 'Hold' rating suggests a neutral stance on the stock, and investors may want to closely monitor the company's financial performance and promoter confidence before making any investment decisions.