Moongipa Capital Finance downgraded to 'Sell' by MarketsMOJO due to weak fundamentals and underperforming profits

Moongipa Capital Finance, a microcap finance company, has recently been downgraded to a 'Sell' by MarketsMOJO. This decision was based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of 10.09% and poor long-term growth as its operating profit has declined by an annual rate of -211.84%.
Despite declaring positive results for the last 5 consecutive quarters, with a growth of 53.83% in net sales and a higher PAT of Rs 1.59 crore in the last 9 months, the stock is still considered a 'Sell'. Technically, the stock is in a mildly bullish range, with multiple factors such as MACD, Bollinger Band, KST, and OBV being bullish.

With an ROE of 27.4, the stock has a fair valuation with a price to book value of 2.3. It is currently trading at a fair value compared to its average historical valuations. However, despite generating a return of 126.15% in the past year, the company's profits have only risen by 159%, resulting in a PEG ratio of 0.

The majority shareholders of Moongipa Capital Finance are non-institutional investors. The company has shown market-beating performance in both the long-term and near-term, outperforming BSE 500 in the last 3 years, 1 year, and 3 months. While the stock has seen a significant increase in returns, it is important to note that this growth has not been reflected in the company's profits. Therefore, MarketsMOJO has downgraded the stock to a 'Sell' based on its current performance and future potential.