MarketsMOJO Downgrades M K Exim (India) to 'Sell' Due to Negative Financial Results

M K Exim (India), a microcap textile company, has recently been downgraded to a 'Sell' by MarketsMOJO on March 12, 2024. This decision was based on the company's negative financial results in December 2023, with a -23.10% growth in PAT (HY) and a lowest ROCE (HY) of 32.17%. Additionally, the company's net sales for the quarter were also at a low of Rs 19.23 crore.
In the past year, M K Exim (India) has underperformed the market, generating a return of only 20.74% compared to the market's 36.59% (BSE 500). The company also has a low Debt to Equity ratio of 0.06 times, indicating a healthy financial position.

However, the company has shown promising long-term growth with an annual growth rate of 35.19% in net sales and 81.87% in operating profit. The technical trend for the stock is currently sideways, suggesting no clear price momentum.

With a ROE of 21.2, the stock is fairly valued with a price to book value of 3.9. However, it is currently trading at a premium compared to its historical valuations. In the past year, while the stock has generated a return of 20.74%, its profits have only risen by 0.3%, resulting in a high PEG ratio of 15.1.

It is worth noting that the majority of shareholders in M K Exim (India) are non-institutional investors. Overall, while the company has shown potential for long-term growth, its recent financial performance and current valuation may not be favorable for investors.