Sreechem Resins Downgraded to 'Sell' by MarketsMOJO, Despite Positive Results and Attractive Valuation

Sreechem Resins, a microcap chemical company, has recently been downgraded to a 'Sell' by MarketsMOJO on October 29, 2024. This decision was based on various factors, including the company's high management efficiency with a ROCE of 15.87%.
In addition, Sreechem Resins has declared positive results for the last three consecutive quarters, with higher net sales of Rs 46.17 crore and a higher PAT of Rs 3.08 crore in the last nine months. However, the technical trend for the stock is currently sideways, indicating no clear price momentum.

Despite this, the technical trend has improved since October 29, 2024, when it was mildly bearish, and has generated a return of 4.33% since then. Moreover, with a ROCE of 20.3, the company has a very attractive valuation with a 1.9 Enterprise value to Capital Employed. The stock is also trading at a discount compared to its average historical valuations.

Over the past year, Sreechem Resins has generated a return of 65.44%, while its profits have risen by 224.9%. This has resulted in a PEG ratio of 0, indicating a potentially undervalued stock. The majority shareholders of the company are non-institutional investors.

Furthermore, Sreechem Resins has a market-beating performance in the long term as well as the near term. Along with generating a return of 65.44% in the last year, the stock has also outperformed BSE 500 in the last three years, one year, and three months. With these factors in mind, investors may want to consider the current 'Sell' rating on Sreechem Resins and do their own research before making any investment decisions.