SRG Housing Finance Receives Upgraded Stock Call from MarketsMOJO, Showing Strong Fundamentals and Consistent Returns

SRG Housing Finance, a microcap company in the finance-housing industry, has recently received an upgraded stock call from MarketsMOJO. The stock has been upgraded to 'Hold' on October 29, 2024.
The decision to upgrade the stock is based on the company's strong long-term fundamental strength, with an average Return on Equity (ROE) of 17.60%. In addition, SRG Housing Finance has declared positive results for the last five consecutive quarters, with a growth of 22.38% in net sales and a debt-equity ratio of 2.68 times, the lowest in the industry. The company's PBDIT (Profit Before Depreciation, Interest, and Taxes) for the quarter is also at its highest at Rs 24.08 crore.

Technically, the stock is in a mildly bullish range, with both the MACD and KST technical factors showing a bullish trend. However, it should be noted that the promoter holding has decreased this quarter and now stands at 64.69% of the company.

Despite this, SRG Housing Finance has consistently generated strong returns over the last three years, outperforming the BSE 500 index in each of the last three annual periods. In the last one year alone, the stock has generated a return of 36.35%.

However, with an ROE of 11.8, the stock is currently trading at a very expensive valuation with a price to book value of 2.4. This is higher than its average historical valuations. Additionally, while the stock has generated strong returns, its profits have only risen by 37.1%, resulting in a PEG ratio of 0.8.

Overall, SRG Housing Finance is a company with strong fundamentals and consistent returns, but investors should be cautious of its expensive valuation. With the recent upgrade to 'Hold' by MarketsMOJO, it will be interesting to see how the stock performs in the future.