Repco Home Finance: Strong Fundamentals and Fair Valuation Make it a 'Hold'

Repco Home Finance, a smallcap company in the finance-housing industry, has recently been downgraded to a 'Hold' by MarketsMOJO on September 2, 2024. This decision was based on the company's strong long-term fundamental strength, with an average Return on Equity (ROE) of 13.17%.
The company has also shown positive results for the last 7 consecutive quarters, with a PAT (HY) of Rs 226.24 crore, which has grown at a rate of 26.10%. Additionally, the company's DEBT-EQUITY RATIO (HY) is at its lowest at 3.58 times, while its NET SALES (Q) are at their highest at Rs 407.83 crore.

Technically, the stock is in a mildly bullish range, with its MACD and KST technical factors also showing a bullish trend. With an ROE of 13.9, the stock is currently trading at an attractive valuation with a 1.1 Price to Book Value. It is also trading at a fair value compared to its average historical valuations.

While the stock has generated a return of 34.10% over the past year, its profits have risen by 30.4%, resulting in a PEG ratio of 0.3. However, the company's long-term growth has been poor, with Net Sales growing at an annual rate of 4.97% and Operating profit at 0.51%.

It is worth noting that the company has a high institutional holding of 32.84%, indicating that these investors have better capability and resources to analyze the fundamentals of companies compared to most retail investors. Overall, with its strong fundamentals and fair valuation, Repco Home Finance is a 'Hold' for now.