KPI Green Energy Downgraded to 'Hold' by MarketsMOJO on April 15, 2024

KPI Green Energy, a midcap company in the engineering and industrial equipment industry, has recently been downgraded to a 'Hold' by MarketsMOJO on April 15, 2024. This decision was based on various factors, including the company's healthy long-term growth in net sales and operating profit, which have grown at annual rates of 112.49% and 103.45%, respectively.
In December 2023, KPI Green Energy declared very positive results with a growth in net sales of 53.49%. The company has consistently declared positive results for the last 10 consecutive quarters, with net sales growing at 59.21% and PAT (profit after tax) at Rs 118.62 crore for the last 9 months. Additionally, the PBDIT (profit before depreciation, interest, and taxes) for the last quarter was at its highest at Rs 103.57 crore.

Technically, the stock is currently in a mildly bullish range, with multiple factors such as MACD, Bollinger Band, and KST indicating a bullish trend. KPI Green Energy has also shown consistent returns over the last 3 years, outperforming the BSE 500 index in each of the last 3 annual periods and generating a return of 467.97% in the last 1 year.

However, the company has a high debt to equity ratio (avg) of 2.58 times, making it a high debt company. Its ROCE (return on capital employed) is at 20.8, indicating a very expensive valuation with an enterprise value to capital employed ratio of 10.2. Despite this, the stock is currently trading at a discount compared to its average historical valuations.

In the past year, while the stock has generated a return of 467.97%, its profits have only risen by 71.8%, resulting in a PEG (price/earnings to growth) ratio of 1.2. This suggests that the stock may be slightly overvalued, leading to the 'Hold' rating by MarketsMOJO. Investors should carefully consider these factors before making any decisions regarding KPI Green Energy stock.