Sri Ramakrishna Mills Downgraded to 'Sell' by MarketsMOJO, High Debt Remains a Concern

Sri Ramakrishna Mills (Coimbatore) is a microcap textile company that has recently been downgraded to a 'Sell' by MarketsMOJO on March 11, 2024. This decision was based on the company's high debt and weak long-term fundamental strength, with a debt to equity ratio of 3.87 times.
Despite positive results for the last four consecutive quarters, with a growth of 52.23% in net sales and higher profits at Rs 3.33 crore, the company's high debt remains a concern. However, the stock is currently in a mildly bullish range and its technical factors, such as MACD and KST, are also bullish.

With a ROCE of 7, the stock is fairly valued with an enterprise value to capital employed ratio of 1.4. It is also trading at a discount compared to its historical valuations. In the past year, the stock has generated a return of 80.65%, while its profits have risen by 698%. This results in a PEG ratio of 0, indicating a potential undervaluation.

The majority shareholders of Sri Ramakrishna Mills (Coimbatore) are the promoters, indicating their confidence in the company's performance. In the long term, the stock has outperformed the BSE 500 index, generating a return of 80.65% in the last year and beating the index in the last 3 years, 1 year, and 3 months.

While the company's high debt may be a concern, its recent performance and market-beating returns make it a stock worth considering for investors. However, it is important to conduct thorough research and analysis before making any investment decisions.