Universal Starch Chem Allied Shows Financial Resilience Amid Long-Term Challenges

Universal Starch Chem Allied has recently undergone an evaluation adjustment, reflecting a nuanced view of its financial standing within the chemicals industry. The company has reported positive financial performance for the quarter ending December 2024, marking a notable turnaround after two consecutive quarters of negative results. Key indicators such as operating profit to interest have reached a high of 5.12 times, while the PBDIT for the quarter stands at Rs 10.49 crore, showcasing operational resilience.
Despite these positive developments, the company faces challenges with its long-term fundamental strength, evidenced by a 14.27% CAGR growth in net sales over the past five years and a high Debt to EBITDA ratio of 3.03 times, indicating potential difficulties in servicing debt. The stock's technical indicators suggest a mildly bearish trend, with MACD and KST factors also reflecting this sentiment.

In terms of valuation, Universal Starch Chem Allied presents an attractive profile with a ROCE of 3.1 and an enterprise value to capital employed ratio of 1.2. The stock has outperformed the broader market, generating a return of 17.10% over the past year, even as the BSE 500 index has seen negative returns.

Discover the Latest Mojo Score and Financial Trend Performance - SignUp in less than 2 Minutes and get FREE Premium Access.