Monarch Networth Capital's Strong Fundamentals and Market-Beating Performance Make it a Company to Watch

Monarch Networth Capital, a smallcap finance company, has recently been downgraded to a 'Hold' by MarketsMOJO on October 24, 2024. This decision was based on the company's strong long-term fundamental strength, with an average Return on Equity (ROE) of 23.16%. Additionally, the company has shown healthy long-term growth, with an annual operating profit growth rate of 65.67%.
In the latest quarter, Monarch Networth Capital declared very positive results, with a growth in net profit of 31.17%. The company has also consistently shown positive results for the last five quarters, with a PAT (9M) of Rs 109.18 crore, which has grown at an impressive rate of 207.23%. The net sales for the same period were also higher at Rs 227.97 crore, with a PBDIT (Q) of Rs 56.27 crore, the highest in recent quarters.

Technically, the stock is currently in a mildly bullish range, with multiple factors such as MACD, KST, DOW, and OBV indicating a bullish trend. Monarch Networth Capital has also outperformed the BSE 500 index in the last 3 years, 1 year, and 3 months, showcasing its market-beating performance in both the long and near term.

However, with an ROE of 35.6, the stock is currently trading at a very expensive valuation, with a 9 Price to Book Value. Despite this, the stock is still trading at a discount compared to its average historical valuations. In the past year, while the stock has generated a return of 96.81%, its profits have risen by 207.3%, resulting in a low PEG ratio of 0.1.

It is also worth noting that despite its smallcap size, domestic mutual funds hold only 0.07% of the company. This could signify that either they are not comfortable with the current price or they have not conducted in-depth research on the company. However, with its strong fundamentals and market-beating performance, Monarch Networth Capital remains a company to watch in the finance/NBFC industry.