MarketsMOJO downgrades Shashijit Infraprojects to 'Sell' due to weak fundamentals and underperformance

Shashijit Infraprojects, a microcap real estate company, has recently been downgraded to a 'Sell' by MarketsMOJO. This decision was based on the company's weak long-term fundamental strength, with an average Return on Capital Employed (ROCE) of only 3.74%. Additionally, the company has a high Debt to EBITDA ratio of 5.71 times, indicating a low ability to service debt.
In the last quarter, Shashijit Infraprojects reported flat results with a decrease in net sales by -32.66% and a lowest PBDIT of Rs 0.16 cr. The operating profit to net sales ratio was also at its lowest at 2.39%. This underperformance in the market has been consistent over the past year, with the stock generating a return of only 2.35%, significantly lower than the market (BSE 500) returns of 37.76%.

Other factors that contribute to the 'Sell' rating include the stock being in a mildly bullish range and its MACD and KST technical factors also being bullish. However, with an ROCE of 5.4, the stock does have an attractive valuation with a 2.1 Enterprise value to Capital Employed. It is also currently trading at a discount compared to its average historical valuations.

It is worth noting that while the stock has generated a return of 2.35% in the past year, its profits have actually fallen by -12%. This could be a cause for concern for potential investors.

Shashijit Infraprojects is primarily owned by its promoters, who hold the majority of the company's shares. As a microcap company in the real estate industry, it is important for investors to carefully consider all factors before making any investment decisions.