Ritesh International Receives 'Hold' Rating from MarketsMOJO After Positive Results

Ritesh International, a microcap company in the chemicals industry, has recently received a 'Hold' rating from MarketsMOJO on November 7, 2024. This upgrade comes after the company reported positive results in September 2024, with a 25.92% growth in net sales and a highest PBDIT (profit before depreciation, interest, and taxes) of Rs. 0.64 crore. Additionally, the operating profit to net sales ratio was also at its highest at 2.47%.
Technically, the stock is currently in a mildly bullish range and has shown improvement from a mildly bearish trend on November 7, 2024. The key technical factor, KST (Know Sure Thing), has been bullish since the same date.

From a valuation standpoint, Ritesh International is trading at a discount compared to its average historical valuations. Its ROCE (return on capital employed) of 4.7 makes it a very attractive investment with a 1.2 enterprise value to capital employed. Despite the stock generating a negative return of -18.23% in the past year, its profits have increased by 140%, resulting in a PEG (price/earnings to growth) ratio of 0.2.

The majority shareholders of Ritesh International are non-institutional investors. However, the company's long-term fundamental strength is weak with an average ROCE of 9.52%. Its ability to service its debt is also poor with a low EBIT (earnings before interest and taxes) to interest ratio of 1.85.

In the last year, Ritesh International has underperformed the market (BSE 500) with a negative return of -18.23%, while the market has generated a return of 31.95%. This indicates that the stock has not been able to keep up with the overall market performance.

Overall, while Ritesh International has shown positive results in the recent past, its long-term fundamental strength and ability to service debt are areas of concern. Investors may want to hold onto their positions for now and monitor the company's performance closely.