Raghuvir Synthetics Adjusts Evaluation Amid Mixed Financial Performance and Debt Concerns

Raghuvir Synthetics, a microcap player in the Garments & Apparels industry, has recently undergone an adjustment in its evaluation score. This revision reflects a shift in technical trends, moving from a bearish outlook to a mildly bearish stance.
The company's performance indicators reveal a mixed picture. Over the past quarter, Raghuvir Synthetics reported a notable growth in net sales, reaching Rs 172.68 crore, which represents a 24.36% increase. Additionally, the company achieved its highest quarterly PBDIT at Rs 6.40 crore, with an operating profit to net sales ratio peaking at 7.74%. Despite these positive results, the company faces challenges with a Return on Capital Employed (ROCE) averaging 4.01%, indicating weak long-term fundamental strength. Furthermore, a high Debt to EBITDA ratio of 4.65 times raises concerns about its ability to service debt.

In terms of market performance, Raghuvir Synthetics has consistently underperformed against benchmarks over the last three years, with a one-year return of -7.89%. However, it is trading at a discount compared to its peers' average historical valuations, and its profits have seen a significant rise of 112.1% over the past year.

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