Navkar Urbanstructure receives 'Hold' rating after impressive financial performance

Navkar Urbanstructure, a microcap company in the construction material industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company's impressive financial performance in the last quarter, with PBT growing at 3447.8% and PAT growing at 703.9%. The company's PBDIT also reached its highest at Rs 2.08 crore.
Technically, the stock is in a bullish range and has shown improvement in its technical trend. Factors such as MACD, Bollinger Band, KST, and OBV all point towards a bullish outlook for the stock.

Majority shareholders of Navkar Urbanstructure are non-institutional investors, and the stock has shown market-beating performance in both the long term and near term. In the last year, the stock has generated a return of 193.76%, outperforming the BSE 500 index.

However, the company's long-term fundamental strength is weak, with a negative CAGR growth in operating profits over the last 5 years. Its ability to service its debt is also a concern, with a poor EBIT to Interest ratio. The company's return on equity is also low, indicating low profitability per unit of shareholders' funds.

With a ROE of 1.6, the stock is currently trading at a very expensive valuation with a price to book value of 1.9. However, it is still trading at a discount compared to its average historical valuations. While the stock has generated impressive returns in the past year, its profits have only risen by 44.1%, resulting in a PEG ratio of 2.7.

Overall, MarketsMOJO's 'Hold' rating on Navkar Urbanstructure suggests a neutral outlook for the stock. Investors should carefully consider the company's weak long-term fundamentals before making any investment decisions.