Jamna Auto Industries Downgraded to 'Sell' by MarketsMOJO, Poor Growth and Technical Factors to Blame

Jamna Auto Industries, a smallcap company in the auto ancillary industry, has recently been downgraded to a 'Sell' by MarketsMOJO on October 15, 2024. This decision was based on several factors, including poor long-term growth with only a 3.81% increase in net sales and a 2.98% increase in operating profit over the last 5 years. In addition, the company's net sales for the quarter ending in June 2024 were at their lowest at Rs 557.14 crore.
Technically, the stock is currently in a Mildly Bearish range, with a deteriorating trend since October 14, 2024, resulting in a 4.2% return. The MACD and KST technical factors are also Bearish, indicating a potential downward trend.

Furthermore, Jamna Auto Industries has underperformed the market in the last year, with a return of only 0.95% compared to the market's 35.67% return (BSE 500). However, the company does have a high management efficiency with a ROE of 18.17% and a strong ability to service debt with a low Debt to EBITDA ratio of 0.52 times.

In terms of valuation, the company has a fair valuation with a Price to Book Value of 5.4 and a ROE of 22.7. This is in line with its average historical valuations. Additionally, while the stock has only generated a 0.95% return in the last year, its profits have increased by 16.8%, resulting in a PEG ratio of 1.4.

It is worth noting that the majority shareholders of Jamna Auto Industries are the promoters themselves, which may have an impact on the company's decision-making and performance. Overall, with the recent downgrade to 'Sell' and the various factors affecting the stock, investors may want to carefully consider their options before investing in Jamna Auto Industries.