Khandwala Securities Receives 'Sell' Rating from MarketsMOJO Due to Weak Fundamentals and Underperformance in Market

Khandwala Securities, a microcap finance company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is due to the company's weak long-term fundamental strength, with an average return on equity (ROE) of 0.42%. Additionally, the stock is currently trading at a premium compared to its historical valuations, with a price to book value of 1.6.
Despite generating a return of 17.55% in the past year, the company's profits have fallen by -32%. This underperformance in the market is a cause for concern for investors. Khandwala Securities has also underperformed the market (BSE 500) returns of 40.49% in the last year.

On a positive note, the company has shown growth in its net sales, with a 62.61% increase in the first half of 2024. Its PBDIT (quarterly) and PBT less OI (quarterly) have also reached their highest levels at Rs 0.56 cr and Rs 0.41 cr respectively.

From a technical standpoint, the stock is currently in a mildly bullish range, with both its MACD and KST technical factors showing a bullish trend. However, the majority of shareholders are non-institutional, which may indicate a lack of confidence from larger investors.

Overall, MarketsMOJO's 'Sell' rating on Khandwala Securities is based on its weak fundamental strength and underperformance in the market. Investors should carefully consider these factors before making any investment decisions.