MarketsMOJO Downgrades SAL Automotive to 'Sell' Due to Poor Growth and Declining Profits

SAL Automotive, a microcap company in the auto ancillary industry, has recently been downgraded to a 'Sell' by MarketsMOJO on November 4th, 2024. This decision was based on several factors, including poor long-term growth and flat results in June 2024.
According to MarketsMOJO, SAL Automotive has shown a slow growth rate in operating profit, with an annual rate of only 22.77% over the last 5 years. In addition, their PAT (9M) has seen a decline of -37.90%, indicating a decrease in profitability.

The technical trend for SAL Automotive is currently sideways, indicating no clear price momentum. This trend has worsened since November 4th, 2024, resulting in a -1.68% return. However, the company does have an attractive valuation with a ROCE of 13.9 and a 2.6 Enterprise value to Capital Employed.

Despite generating a return of 36.82% in the past year, SAL Automotive's profits have fallen by -21.3%. This could be a cause for concern for investors, especially since the majority shareholders are the promoters.

On a positive note, SAL Automotive has consistently outperformed the BSE 500 in the last 3 annual periods, indicating consistent returns. However, with the recent downgrade and other factors to consider, investors may want to approach this stock with caution.