Quest Capital Markets receives 'Hold' rating and reports record high cash reserves

Quest Capital Markets, a microcap finance company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company reported positive results in the first quarter of 2024. The company's cash and cash equivalents have reached a record high of Rs 29.69 crore, while its PBDIT and PBT LESS OI have also seen significant growth.
In addition to its strong financial performance, the stock is also showing bullish trends in the technical analysis. It has been in a bullish range since August 1, 2024, and has generated a return of 1.79% since then. The MACD, Bollinger Band, and KST indicators all point towards a positive outlook for the stock.

However, with a ROE of 2, the stock is currently trading at a premium compared to its historical valuations. Its PEG ratio of 3.2 also suggests that it may be slightly overvalued. The majority shareholders of Quest Capital Markets are its promoters, indicating their confidence in the company's future prospects.

Despite its strong performance in the past year, with a return of 45.09%, the company's profits have only increased by 6.8%. This could be a cause for concern for long-term investors, as the company's average ROE over the last 3 years is only 5.54%.

Overall, while Quest Capital Markets has shown consistent returns in the past 3 years and has received a 'Hold' rating from MarketsMOJO, its long-term fundamental strength may be weak. Investors should carefully consider these factors before making any investment decisions.