Landmark Cars Faces Profit Decline Amid Shift to Mildly Bullish Evaluation

Landmark Cars, a small-cap player in the automobile industry, has recently undergone an adjustment in its evaluation score. This revision reflects a shift in technical trends, moving from a sideways pattern to a mildly bullish stance.
Key financial metrics indicate that the company has faced challenges, particularly in its operating profits, which have shown a compound annual growth rate (CAGR) decline of 22.40% over the past five years. The company's ability to service its debt is also a concern, highlighted by a Debt to EBITDA ratio of 3.24 times. Additionally, the average Return on Equity (ROE) stands at 7.11%, suggesting limited profitability relative to shareholders' funds.

In terms of recent performance, Landmark Cars reported a significant drop in profit after tax for Q4 FY24-25, with a decrease of 77.8% compared to the previous four-quarter average. The stock has underperformed the broader market, generating a return of -16.72% over the past year, while the BSE500 index has seen a modest gain of 0.37%.

Despite these challenges, the company maintains a fair valuation with a Return on Capital Employed (ROCE) of 6.6 and high institutional holdings at 23.45%, indicating a level of confidence from larger investors.

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