Kamadgiri Fashion Adjusts Valuation Amid Strong Financial Performance and Market Challenges

Kamadgiri Fashion, a microcap player in the Garments & Apparels industry, has recently undergone an adjustment in evaluation, reflecting a revision in its score. This change is primarily attributed to a shift in its valuation grade, moving from attractive to fair.
The stock's current PE ratio stands at 69.11, indicating a premium valuation compared to its peers. Additionally, the Price to Book Value is recorded at 2.49, while the EV to EBIT and EV to EBITDA ratios are 16.56 and 10.35, respectively. The company’s EV to Capital Employed ratio is 1.55, and it has an EV to Sales ratio of 0.53.

Despite these valuation metrics, Kamadgiri Fashion has demonstrated notable financial performance, with a PAT of Rs 1.25 crore reflecting a growth of 157.08% and a PBT of Rs 1.35 crore growing at 187.10%. The company has also reported a ROCE of 9.36%, showcasing its operational efficiency.

While the stock has outperformed the broader market with a return of 101.86% over the past year, it faces challenges such as a high Debt to EBITDA ratio of 4.55 times and a low average Return on Equity of 2.29%.

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