Texmaco Rail & Engineering Downgraded to 'Hold' by MarketsMOJO on Recent Financial Performance and Technical Trends

Texmaco Rail & Engineering, a midcap company in the railway industry, has recently been downgraded to a 'Hold' by MarketsMOJO on November 11, 2024. This decision was based on the company's recent financial performance and technical trends.
While Texmaco Rail & Engineering reported outstanding results in September 2024 with a growth in net profit of 233.81%, the company's technical trend has deteriorated from mildly bullish to sideways, indicating no clear price momentum. Additionally, the company has a high debt to EBITDA ratio of 4.74 times, which may affect its ability to service debt.

However, the company has consistently declared positive results for the last 8 consecutive quarters and has a strong operating cash flow of Rs 95.78 crore. It also has a high return on capital employed (ROCE) of 11.82%, making it an attractive valuation with a 2.7 enterprise value to capital employed.

Texmaco Rail & Engineering has also outperformed the BSE 500 index in the last 3 annual periods, generating a return of 61.73%. However, its profitability per unit of shareholders' funds is relatively low with a return on equity (avg) of 4.26%.

Institutional investors, who have better resources to analyze company fundamentals, have decreased their stake in Texmaco Rail & Engineering by -1.32% over the previous quarter. This may indicate a lack of confidence in the company's future performance.

Overall, while Texmaco Rail & Engineering has shown consistent returns in the past, its current financial and technical trends suggest a 'Hold' rating for now. Investors should closely monitor the company's performance and future developments before making any investment decisions.