NLC India Upgraded to 'Hold' Rating by MarketsMOJO, Shows Healthy Long-Term Growth

NLC India, a largecap company in the power generation and distribution industry, has recently been upgraded to a 'Hold' rating by MarketsMOJO. This decision is based on several factors, including the company's healthy long-term growth with an annual operating profit growth rate of 29.78%.
Technically, the stock is currently in a mildly bullish range, with a positive trend since November 11, 2024, resulting in a return of -4.48%. This is supported by factors such as Bollinger Band, DOW, and OBV.

In terms of valuation, NLC India has an attractive ROCE of 4.9 and a low enterprise value to capital employed ratio of 1.4. Additionally, the stock is currently trading at a discount compared to its historical valuations. However, it is worth noting that while the stock has generated a return of 51.34% in the past year, its profits have fallen by -4.5%.

The company also has a high institutional holding of 21.14%, indicating that these investors have better resources and capabilities to analyze the company's fundamentals. This stake has also increased by 0.83% in the previous quarter.

NLC India has consistently outperformed the BSE 500 index in the last three annual periods, with a return of 51.34%. However, it has a high debt to EBITDA ratio of 6.55 times, indicating a low ability to service debt. The company's return on equity (avg) is also at a low of 9.97%, indicating low profitability per unit of shareholders' funds.

In the latest financial results for September 2024, NLC India reported flat results with a decline in PAT (9M) by -31.80% and a decrease in PBT LESS OI(Q) by -15.5%. The company's ROCE (HY) was also at its lowest at 8.18%.

Overall, while NLC India has shown consistent returns and has attractive valuation metrics, it also has some concerning factors such as high debt and low profitability. Investors may want to hold onto their positions and monitor the company's performance closely.