Repco Home Finance Upgraded to 'Hold' Rating Based on Strong Fundamentals

Repco Home Finance, a smallcap company in the finance-housing industry, has recently been upgraded to a 'Hold' rating by MarketsMOJO. This decision is based on the company's strong long-term fundamental strength, with an average Return on Equity (ROE) of 13.17%.
In the last 8 consecutive quarters, Repco Home Finance has declared positive results, with its highest net sales of Rs 415.25 crore and PBDIT of Rs 388.86 crore. The company also has a strong cash position, with cash and cash equivalents of Rs 842.36 crore.

At a ROE of 13.9, the company's valuation is considered very attractive with a price to book value of 0.9. The stock is currently trading at a fair value compared to its historical valuations. However, its long-term growth has been poor, with net sales growing at an annual rate of 4.75% and operating profit at 0.51%.

Technically, the stock is in a mildly bearish range and has underperformed the market in the last year, generating a return of only 4.76% compared to the market's 23.90%. The stock's technical trend has deteriorated from mildly bullish to mildly bearish, with multiple factors such as MACD, Bollinger Band, and KST indicating a bearish outlook.

It is worth noting that the company has a high institutional holding of 32.81%, indicating that these investors have better capabilities and resources to analyze the company's fundamentals compared to retail investors. Overall, while Repco Home Finance has strong long-term fundamentals, its poor growth and technical outlook suggest a 'Hold' rating for now.