MarketsMOJO Upgrades Alfa Ica (India) to 'Hold' Based on Technical Indicators and Attractive Valuation

Alfa Ica (India) is a microcap company in the wood products industry. Recently, MarketsMOJO upgraded their stock call on the company to 'Hold' on July 3rd, 2024. This upgrade is based on various technical indicators, such as the stock being in a bullish range and showing improvement in trends since July 1st, resulting in a 5.88% return.
One of the key factors contributing to this upgrade is the company's attractive valuation, with a ROCE of 8.3 and an enterprise value to capital employed ratio of 1.1. Additionally, the stock is currently trading at a discount compared to its historical valuations. In the past year, the stock has generated a return of 28.05%, while its profits have increased by 16.6%. This results in a PEG ratio of 0.9, indicating a positive outlook for the company.

The majority shareholders of Alfa Ica (India) are the promoters, which can be seen as a positive sign for investors. However, the company does have some weak long-term fundamental strengths, with an average ROCE of 8.72% and a low growth rate in net sales and operating profit over the last 5 years.

Furthermore, the company has a high debt to EBITDA ratio of 4.03 times, indicating a low ability to service debt. In the most recent quarter, the company's operating profit to net sales was at its lowest at 5.27%.

Overall, while Alfa Ica (India) shows potential for growth and has received a 'Hold' rating from MarketsMOJO, it is important for investors to consider the company's weak long-term fundamentals and high debt levels before making any investment decisions.