Real Touch Finance Downgraded to 'Sell' by MarketsMOJO Due to Weak Fundamentals and Expensive Valuation

Real Touch Finance, a microcap finance company, has recently been downgraded to a 'Sell' by MarketsMOJO on November 4, 2024. This decision was based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of 4.34%. Additionally, the stock has a very expensive valuation with a price to book value of 2.3, trading at a discount compared to its historical valuations.
Despite generating a return of 202.09% in the past year, the company's profits have fallen by -12.1%. However, Real Touch Finance has declared positive results for the last 7 consecutive quarters, with a growth of 34.55% in net sales for the last 9 months and the highest PBDIT and PBT LESS OI in the last quarter.

Technically, the stock is in a mildly bullish range, with both MACD and KST technical factors showing a bullish trend. The majority shareholders of Real Touch Finance are the promoters, indicating their confidence in the company's future prospects.

Moreover, the stock has consistently outperformed BSE 500 in the last 3 annual periods, showcasing its strong performance over the years. With all these factors in mind, MarketsMOJO has downgraded the stock to a 'Sell' and advises investors to be cautious while considering Real Touch Finance for their portfolio.