Savita Oil Technologies Downgraded to 'Sell' by MarketsMOJO, Facing Challenges in Growth and Profitability

Savita Oil Technologies, a smallcap company in the lubricants industry, has recently been downgraded to a 'Sell' by MarketsMOJO on September 16, 2024. This decision was based on the company's poor long-term growth, with an annual operating profit growth rate of -24.74% over the last 5 years.
In addition, the company's results for June 2024 showed a decline in profits, with PBT (profit before tax) falling by -26.1% and PAT (profit after tax) falling by -20.6%. Non-operating income also accounted for a significant portion of the company's profits, at 33.14% of PBT.

Despite these negative factors, Savita Oil Technologies has shown high management efficiency with a ROE (return on equity) of 16.22%. The company also has a low debt to equity ratio, averaging at 0 times.

Technically, the stock is currently in a mildly bullish range, with multiple indicators such as MACD, Bollinger Band, KST, and DOW pointing towards a bullish trend. However, with a ROE of 12.4, the stock is fairly valued with a price to book value of 2.5. It is also trading at a premium compared to its historical valuations.

In the past year, Savita Oil Technologies has generated a return of 77.46%, outperforming the BSE 500 index. However, its profits have fallen by -2.9%. The majority shareholders of the company are the promoters, indicating their confidence in the company's long-term performance.

Overall, while Savita Oil Technologies has shown market-beating performance in the long term, it is currently facing challenges in terms of growth and profitability. Investors should carefully consider these factors before making any investment decisions.