MarketsMOJO Downgrades Pasupati Acrylon Due to Poor Growth and Lackluster Financial Results

Pasupati Acrylon, a microcap company in the textile industry, has recently received a 'Sell' rating from MarketsMOJO on November 14, 2024. This downgrade is based on the company's poor long-term growth, with an annual operating profit growth rate of -2.44% over the past 5 years.

The company's recent financial results for the quarter ending September 24 have also been lackluster, with a significant decline in profits and net sales. The PBT (profit before tax) less OI (other income) has fallen by -70.8%, while the PAT (profit after tax) has fallen by -53.0%. Additionally, the net sales have also seen a decline of -18.4%.

With a ROE (return on equity) of 10.4, the company's valuation is considered expensive with a price to book value of 1.1. This is further supported by the fact that the stock is currently trading at a premium compared to its historical valuations. Although the stock has generated a return of 10.99% in the past year, its profits have only risen by 190.5%, resulting in a PEG (price/earnings to growth) ratio of 0.1.

In the past year, Pasupati Acrylon has underperformed the market, with a return of 10.99% compared to the BSE 500 index's return of 26.29%. The company also has a low debt to equity ratio, indicating a strong financial position.

From a technical standpoint, the stock's trend is currently sideways, indicating no clear price momentum. This trend has deteriorated from mildly bullish on November 14, 2024, resulting in a -3.82% return since then.

It is worth noting that the majority shareholders of Pasupati Acrylon are the promoters themselves. This could potentially raise concerns about the company's corporate governance practices.

In conclusion, based on the recent downgrade and other factors such as poor financial performance and expensive valuation, it may be wise for investors to exercise caution when considering Pasupati Acrylon as a potential investment option.