National Plastic Technologies Downgraded to 'Sell' by MarketsMOJO on September 2nd, 2024

National Plastic Technologies, a microcap company in the plastic products industry, has recently been downgraded to a 'Sell' by MarketsMOJO on September 2nd, 2024. This decision was based on several factors, including poor management efficiency with a low ROCE of 8.41% and a high Debt to EBITDA ratio of 5.03 times, indicating a low ability to service debt. Additionally, the company has only seen flat results in the most recent quarter and has a high interest expense of Rs 1.46 crore.
However, there are some positive aspects to consider. National Plastic Technologies has shown healthy long-term growth with a 24.57% annual increase in net sales and a 44.01% increase in operating profit. The stock also has an attractive valuation with a ROCE of 16 and a 2.9 Enterprise value to Capital Employed. It is currently trading at a discount compared to its historical valuations.

The technical trend for the stock is currently sideways, indicating no clear price momentum. And while the stock has generated a return of 110.79% in the past year, its profits have only risen by 24.8%, resulting in a PEG ratio of 1.1. The majority shareholders of National Plastic Technologies are the promoters.

Despite the recent downgrade, the company has consistently outperformed the BSE 500 index in the last 3 annual periods, showing consistent returns. However, it is important to consider the current financial situation and management efficiency before making any investment decisions.