Inventure Growth & Securities Downgraded to 'Sell' by MarketsMOJO Due to Weak Fundamental Strength and Lackluster Performance

Inventure Growth & Securities, a microcap finance company, has recently been downgraded to a 'Sell' by MarketsMOJO. This decision was based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of only 3.57%. Additionally, the company has shown poor long-term growth, with a decline in Net Sales by an annual rate of -0.26%.
Despite declaring positive results for the last three consecutive quarters and a growth in Net Profit of 163.16% in March 2024, Inventure Growth & Securities' overall performance has been lackluster. Its NET SALES(HY) has only grown at a rate of 51.32%, and its PBDIT(Q) is at its highest at Rs 11.16 cr. However, the company's OPERATING PROFIT TO NET SALES(Q) is also at its highest at 51.17%.

The technical trend for the stock is currently sideways, indicating no clear price momentum. This trend has deteriorated from being mildly bullish on 01-Jul-24 and has generated -1.67% returns since then. With an ROE of 6.4, the stock is fairly valued with a 1.1 Price to Book Value. However, it is currently trading at a premium compared to its average historical valuations.

In the past year, Inventure Growth & Securities has outperformed the market (BSE 500) with a return of 48.24%. However, its profits have only risen by 52.2%, resulting in a PEG ratio of 0.3. The majority of the company's shareholders are non-institutional investors.

In conclusion, while Inventure Growth & Securities has shown some positive results in the past year, its overall performance and fundamental strength are not strong enough to warrant a 'Buy' recommendation. Investors should carefully consider the company's financials and market performance before making any investment decisions.