MarketsMOJO upgrades Mohit Paper Mills to 'Hold' based on technical indicators and attractive valuation

Mohit Paper Mills, a microcap company in the paper and paper products industry, has recently received a 'Hold' rating from MarketsMOJO on September 3, 2024. This upgrade is based on various technical indicators that show a bullish trend for the stock.
One of the key factors contributing to this upgrade is the stock's attractive valuation, with a ROCE of 5.4 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.

Over the past year, Mohit Paper Mills has generated a return of 67.16%, outperforming the BSE 500 index. However, its profits have only seen a modest increase of 2.5%, resulting in a PEG ratio of 3.8. The majority shareholders of the company are its promoters.

While the stock has shown consistent returns over the last 3 years, its long-term fundamental strength is weak with an average ROCE of 5.27%. The company has also experienced poor growth in operating profit over the last 5 years, with an annual growth rate of only 9.28%. Additionally, its ability to service debt is low, with a high debt to EBITDA ratio of 6.09 times.

In the latest quarter, Mohit Paper Mills reported flat results with a PAT of Rs 2.27 crore, showing a decline of -39.63% compared to the same period last year. Overall, while the stock is currently in a bullish range, its long-term fundamentals may need improvement for sustained growth. Investors are advised to hold their positions and monitor the company's performance closely.