Kretto Syscon Receives 'Hold' Rating from MarketsMOJO After Positive Results

Kretto Syscon, a microcap company in the hospital and healthcare services industry, has recently received a 'Hold' rating from MarketsMOJO on October 17, 2024. This upgrade comes after the company reported positive results in September 2024, with a higher PAT (HY) of Rs 4.69 crore and the highest PBDIT (Q) and PBT LESS OI (Q) at Rs 5.22 crore.
The stock is currently in a bullish range and has shown a significant improvement in its technical trend since October 3, 2024, generating a return of 32.26%. Multiple factors such as MACD, Bollinger Band, KST, and OBV have contributed to the stock's bullish performance.

Majority shareholders of Kretto Syscon are non-institutional investors, and the stock has outperformed BSE 500 in the long term as well as the near term, with a return of 114.84% in the last year.

However, the company's long-term fundamental strength is weak, with an average ROE of 0.95%. Its growth in net sales and operating profit over the last 5 years has been poor, at 49.02% and 9.86%, respectively. Additionally, the company's ability to service its debt is weak, with a poor EBIT to Interest (avg) ratio of -0.25.

Kretto Syscon currently has a very expensive valuation, with a price to book value of 4.5 and a PEG ratio of 0. Despite generating a return of 114.84% in the last year, the company's profits have only risen by 471%. However, the stock is currently trading at a discount compared to its average historical valuations.

In conclusion, while Kretto Syscon has shown a positive performance in the short term, its long-term fundamentals and valuation may be a cause for concern. Investors are advised to hold their positions and monitor the company's performance closely.