MarketsMOJO Upgrades Ajmera Realty & Infra India Stock to 'Hold' on Strong Operating Profit Growth and Bullish Technical Indicators

Ajmera Realty & Infra India, a smallcap company in the construction and real estate industry, has recently received an upgraded stock call from MarketsMOJO. The stock has been upgraded to 'Hold' on October 16, 2024.
The company has shown a positive growth in its operating profit, with a 72.32% increase in Jun 24. This trend has continued for the last three consecutive quarters. Additionally, the company has a strong operating cash flow of Rs 219.74 Cr and a high return on capital employed at 12.39%. Its debt-equity ratio is also at a low of 0.93 times.

Technically, the stock is in a mildly bullish range and has shown improvement from a sideways trend on October 16, 2024. Multiple factors such as MACD, Bollinger Band, KST, and OBV indicate a bullish trend for the stock.

In terms of market performance, Ajmera Realty & Infra India has outperformed BSE 500 in the last 3 years, 1 year, and 3 months, with a return of 103.22% in the last year alone.

However, the company has a weak long-term fundamental strength, with a low CAGR growth of 8.75% in operating profits over the last 5 years. It also has a high debt to EBITDA ratio of 6.75 times, indicating a low ability to service debt. The return on equity is also low at 7.46%, indicating low profitability per unit of shareholders' funds.

The stock is currently trading at an expensive valuation, with an enterprise value to capital employed ratio of 2.3. However, it is still at a discount compared to its average historical valuations. The PEG ratio of the company is 0.7, indicating that its profits have risen by 39.8% in the past year, while the stock has generated a return of 103.22%.

It is worth noting that despite being a smallcap company, domestic mutual funds hold only 0% of the company. This could signify that they are not comfortable with the current price or the business, as they have the capability to conduct in-depth research on companies.

Overall, Ajmera Realty & Infra India has shown positive results and market-beating performance in the near and long term. However, its weak long-term fundamental strength and high debt levels should be considered before making any investment decisions.