L G Balakrishnan & Bros downgraded to 'Hold' by MarketsMOJO due to mixed performance.

L G Balakrishnan & Bros, a smallcap company in the engineering and industrial equipment industry, has recently been downgraded to a 'Hold' by MarketsMOJO on August 1, 2024. This decision was based on various factors such as the company's high management efficiency with a ROE of 15.40%, low debt to equity ratio of 0.08 times, and its stock being in a mildly bullish range.
The company also has an attractive valuation with a ROE of 16.2 and a price to book value of 2.7. However, it is currently trading at a fair value compared to its average historical valuations. In the past year, the stock has generated a return of 29.48%, while its profits have only risen by 10.2%. This gives the company a PEG ratio of 1.6.

One of the positive aspects of L G Balakrishnan & Bros is its high institutional holdings at 21.78%. This indicates that these investors have better capability and resources to analyze the fundamentals of the company compared to most retail investors.

However, the company has shown poor long-term growth with its net sales only growing at an annual rate of 6.81% over the last 5 years. In addition, its results for the quarter ending June 24 were flat, with its ROCE (HY) at its lowest at 20.97%, and its PAT (Q) at Rs 59.81 crore, falling by -10.2%. The PBT LESS OI (Q) was also at its lowest at Rs 65.88 crore.

Overall, while L G Balakrishnan & Bros may have some positive aspects, it is currently facing challenges in terms of long-term growth and recent financial results. Investors may want to hold off on buying or selling this stock until there is more clarity on its performance.