Longspur International Ventures Receives 'Hold' Rating from MarketsMOJO, But Weak Fundamentals and Underperformance Raise Concerns for Investors

Longspur International Ventures, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO on February 27, 2024. This upgrade comes after the company reported positive results in December 2023, with a PBT (profit before tax) of Rs 0.49 crore and a PAT (profit after tax) of Rs 0.36 crore. The EPS (earnings per share) also saw a significant increase, reaching Rs 0.26.
Technically, the stock is currently in a bullish range, with the technical trend improving from mildly bullish on February 27, 2024. Multiple factors, such as MACD, Bollinger Band, and OBV, indicate a bullish outlook for the stock.

However, the majority shareholders of Longspur International Ventures are non-institutional investors, which may raise concerns for some investors. Additionally, the company's long-term fundamental strength is weak, with a -8.83% CAGR growth in operating profits over the last 5 years. Its ability to service its debt is also a cause for concern, with a poor EBIT to Interest (average) ratio of -0.13. Furthermore, the company's return on equity (average) stands at a low 0.24%, indicating low profitability per unit of shareholders' funds.

The stock is currently trading at a premium compared to its average historical valuations, with a price to book value of 0.7 and a ROE of 0.2. In the past year, while the stock has generated a return of -8.02%, its profits have fallen by -30%. This underperformance is significant, especially when compared to the market (BSE 500), which has generated returns of 38.66% in the same period.

In conclusion, while Longspur International Ventures has shown positive results in the recent past, its weak long-term fundamentals and underperformance in the market may make it a risky investment. Investors are advised to carefully consider all factors before making any investment decisions.