Intrasoft Technologies upgraded to 'Hold' by MarketsMOJO, attractive valuation and improving technical trend

Intrasoft Technologies, a microcap company in the BPO/ITeS industry, has recently been upgraded to a 'Hold' by MarketsMOJO. This decision is based on the company's current technical trend, which is sideways with no clear price momentum. However, the technical trend has improved from mildly bearish on June 26, 2024, and has generated a return of -0.82% since then.
One of the main reasons for the 'Hold' rating is the company's attractive valuation. With a ROCE of 6.8 and an enterprise value to capital employed ratio of 1, Intrasoft Technologies is trading at a discount compared to its average historical valuations. Additionally, while the stock has generated a negative return of -8.98% in the past year, its profits have increased by 16.5%. However, the PEG ratio of the company is 4, indicating a slightly overvalued stock.

On the downside, the promoter holding has decreased this quarter and now stands at 43.06% of the company. This could be a cause for concern as it signifies a lack of confidence from the promoters. Moreover, the company has a high debt to EBITDA ratio of 3.37 times, indicating a low ability to service debt.

In terms of financial performance, Intrasoft Technologies has shown flat results in the quarter ending March 2024. The company's interest expenses were the highest at Rs 3.16 crore, and non-operating income accounted for 63.22% of the profit before tax. The earnings per share for the quarter were the lowest at Rs 1.45.

Overall, Intrasoft Technologies has had a below-par performance in both the long term and near term. Along with generating a negative return of -8.98% in the last year, the stock has also underperformed the BSE 500 index in the last 3 years, 1 year, and 3 months. Investors are advised to hold their positions in the company and monitor its performance closely.