Shree Rama Multi-Tech Receives 'Hold' Rating from MarketsMOJO, Shows Positive Results in Recent Quarter

Shree Rama Multi-Tech, a microcap company in the packaging industry, has recently received a 'Hold' rating from MarketsMOJO on October 31, 2024. This upgrade is based on the company's positive results in the quarter ending June 2024, with its PBDIT (Quarterly) reaching a high of Rs 5.15 crore and operating profit to net sales (Quarterly) at 11.98%. Additionally, the company's PBT less OI (Quarterly) has also reached a high of Rs 3.69 crore.
Technically, the stock is currently in a mildly bullish range and has shown improvement since October 29, 2024, generating a return of 10.23%. The Bollinger Band, a key technical factor, has also been bullish since October 29, 2024.

The majority shareholders of Shree Rama Multi-Tech are the promoters, indicating their confidence in the company's performance. However, there are some concerns regarding the company's financial health, with a high debt to EBITDA ratio of 11.23 times and a poor long-term growth rate of 6.66% in net sales over the last 5 years. The company's return on capital employed (avg) is also low at 5.85%, indicating low profitability per unit of total capital.

The stock is currently trading at a premium with a price to book value of 3.9 and has underperformed the market in the last year, generating a return of 14.93% compared to the market's return of 34.33%. However, the company's profits have seen a significant increase of 113.6% in the past year, resulting in a low PEG ratio of 0.3.

In conclusion, while Shree Rama Multi-Tech has shown positive results and technical improvements, there are concerns regarding its financial health and underperformance in the market. Investors may want to hold onto their positions for now and monitor the company's performance in the future.