Jyoti Resins and Adhesives Receives 'Hold' Rating Based on Strong Financials and Growth

Jyoti Resins and Adhesives, a smallcap company in the chemicals industry, has recently received a 'Hold' rating from MarketsMOJO on February 1, 2024. This upgrade is based on the company's low Debt to Equity ratio, which is at 0 times on average.
The company has shown healthy long-term growth with an annual increase of 31.27% in Net Sales and 105.11% in Operating profit. In addition, Jyoti Resins and Adhesives has declared positive results for the last 13 consecutive quarters, with a PAT (HY) of Rs 31.91 crore, growing at 78.47%, and a PBDIT (Q) of Rs 21.40 crore, the highest in its industry at 33.99%.

Technically, the stock is in a mildly bullish range and has shown improvement from a sideways trend on February 1, 2024. The Bollinger Band and DOW technical factors also indicate a mildly bullish trend.

Jyoti Resins and Adhesives has consistently outperformed the BSE 500 index in the last 3 years, with a return of 33.71%. However, with a ROE of 57.1, the stock is currently trading at a very expensive valuation with a price to book value of 16.9. Despite this, the stock is still trading at a discount compared to its average historical valuations. The PEG ratio of the company is 0.3, indicating a potential for future growth.

It is worth noting that despite its small size, domestic mutual funds hold only 0% of the company. This could signify that they are not comfortable with the current price or the business, as domestic mutual funds have the capability to conduct in-depth research on companies.

Overall, Jyoti Resins and Adhesives has shown strong growth and consistent returns, but investors should carefully consider the high valuation and the lack of interest from domestic mutual funds before making any investment decisions.