TGV Sraac Upgraded to 'Hold' by MarketsMOJO, Attractive Valuation and Positive Technical Factors

TGV Sraac, a smallcap company in the chemicals industry, has recently been upgraded to a 'Hold' by MarketsMOJO. This is due to its healthy long-term growth, with an annual operating profit growth rate of 32.04%. The stock is also technically in a Mildly Bullish range, with its technical trend improving from Mildly Bearish on 20-Sep-24. The MACD and KST technical factors are also Bullish, indicating a positive outlook for the stock.
One of the main reasons for the 'Hold' rating is the company's attractive valuation. With a ROCE of 15.2 and an enterprise value to capital employed ratio of 0.9, the stock is trading at a discount compared to its average historical valuations. However, it is important to note that the stock has underperformed the market in the last year, generating negative returns of -22.89% while the market (BSE 500) has generated returns of 37.95%.

The company has also declared negative results for the last 6 consecutive quarters, with its profits falling by -89%. The PAT (HY) at Rs 7.64 crore has seen a decline of -85.23%, while the net sales (HY) at Rs 747.07 crore has also seen a decline of -20.88%. This may be a cause for concern for investors.

Another factor to consider is the low stake of domestic mutual funds in the company, at only 0.05%. This could indicate that they are not comfortable with the price or the business, as they have the capability to conduct in-depth research on companies.

In conclusion, while TGV Sraac may have potential for long-term growth, the current situation of negative results and underperformance in the market may warrant a 'Hold' rating for now. Investors should carefully consider all factors before making any decisions regarding this smallcap company in the chemicals industry.