Thirumalai Chemicals Upgraded to 'Hold' Rating

Thirumalai Chemicals, a smallcap company in the chemicals industry, has recently been upgraded to a 'Hold' by MarketsMOJO. This decision is based on various factors, including the company's low Debt to Equity ratio, which is currently at 0 times. Additionally, the stock is currently in a Bullish range and the technical trend has improved from Mildly Bullish on 26-Dec-23. Multiple indicators such as MACD, Bollinger Band, and OBV also suggest a Bullish outlook for the stock.
Moreover, Thirumalai Chemicals has an attractive valuation with a ROCE of 1.3 and an Enterprise value to Capital Employed ratio of 1.7. However, the stock is currently trading at a premium compared to its average historical valuations. In the past year, the stock has generated a return of 13.19%, but its profits have fallen by -100%.

The company has also shown poor long-term growth, with its Operating profit growing at an annual rate of -12.95% over the last 5 years. In addition, Thirumalai Chemicals has declared negative results for the last 4 consecutive quarters, with PBT LESS OI(Q) at Rs -10.53 cr and PAT(Q) at Rs -6.00 cr, both showing a significant decline. The company's Operating CF(Y) is also at its lowest at Rs 54.13 Cr.

Despite being a smallcap company, domestic mutual funds hold only 0.08% of Thirumalai Chemicals. This could indicate that they are not comfortable with the current price or the business, as domestic mutual funds have the capability to conduct in-depth research on companies.

In the last 1 year, Thirumalai Chemicals has underperformed the market, with a return of 13.19% compared to the market (BSE 500) returns of 24.32%. While the company has shown some positive indicators, it is important to consider all factors before making any investment decisions.