Sunshield Chemicals Receives 'Hold' Rating from MarketsMOJO

Sunshield Chemicals, a microcap company in the chemicals industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes as the stock has shown a mildly bullish trend and has generated a return of 1.67% since 20-Dec-23. The technical factors such as MACD and Bollinger Band also indicate a bullish trend.
One of the reasons for the 'Hold' rating is the company's attractive valuation with a ROCE of 15.8 and an enterprise value to capital employed ratio of 4.7. Additionally, the stock is currently trading at a discount compared to its historical valuations. However, it is important to note that the company's profits have fallen by -24% in the past year, despite generating a return of 59.50%.

Institutional investors have also shown an increasing interest in Sunshield Chemicals, with a 1.51% increase in their stake in the company over the previous quarter. This is a positive sign as these investors have better resources and capabilities to analyze the fundamentals of companies.

The stock has also outperformed the market (BSE 500) with a return of 59.50% in the last year, compared to the market's return of 24.32%. However, Sunshield Chemicals has a high debt to equity ratio of 4.43 times and has shown poor long-term growth with a net sales growth rate of only 4.72% over the last 5 years.

In the latest financial results for September 2023, the company reported negative results with the lowest operating cash flow at Rs 14.12 Cr and the lowest ROCE at 16.35%. The inventory turnover ratio was also at its lowest at 6.36 times.

Overall, while Sunshield Chemicals has shown some positive signs, it is important to consider the company's high debt and poor long-term growth before making any investment decisions. Investors should also keep an eye on the company's financial performance in the upcoming quarters.