Modern Dairies Receives 'Hold' Rating from MarketsMOJO After Positive Results and Bullish Outlook

Modern Dairies, a microcap company in the FMCG industry, has recently received a 'Hold' rating from MarketsMOJO on August 9, 2024. This upgrade comes after the company declared very positive results in March 2024, with a growth in net profit of 40.27%. The company has also shown positive results for the last two consecutive quarters, with a growth in net sales of 51.80% and the highest PBDIT and operating profit to net sales ratios.
Technically, the stock is in a bullish range and the trend has improved from mildly bullish on August 9, 2024. Multiple factors such as MACD, Bollinger Band, and KST indicate a bullish outlook for the stock.

In the long term, Modern Dairies has outperformed the BSE 500 index and has generated a return of 137.13% in the last year. However, the company has a negative book value and weak long-term fundamental strength. Net sales have declined by an annual rate of -8.46% and operating profit has remained stagnant over the last 5 years. Additionally, the company has a high debt to equity ratio, making it a risky investment.

Furthermore, the stock is trading at a higher risk compared to its historical valuations. While it has generated a high return of 137.13% in the past year, its profits have only increased by 22.8%, resulting in a low PEG ratio of 0.4.

Investors should also take note that 99.95% of promoter shares are pledged, which can put additional downward pressure on the stock prices in falling markets. Overall, while Modern Dairies has shown strong performance in the near term, its long-term fundamentals and high risk factors should be carefully considered before making any investment decisions.