Wheels India . Upgraded to 'Hold' Rating by MarketsMOJO, Shows Impressive Financial Results

Wheels India ., a smallcap company in the auto ancillary industry, has recently been upgraded to a 'Hold' rating by MarketsMOJO. This decision is based on the company's positive financial results for the last three consecutive quarters. In the half-year period, the company's profits have grown by an impressive 236.63%, with a highest ROCE of 15.23% and a low debt-to-equity ratio of 0.86 times.
Technically, the stock is currently in a mildly bullish range and has shown improvement since 28 October 2024, generating a return of -3.02%. The key technical factor, MACD, has also been bullish since the same date. With a ROCE of 14.5, the stock is considered to have an attractive valuation with a 1.5 enterprise value to capital employed. It is also trading at a discount compared to its average historical valuations.

However, the company's long-term fundamental strength is weak, with an average ROCE of 8.43%. Its net sales have only grown at an annual rate of 8.44% and operating profit at 0.92% over the last 5 years. Additionally, the company has a high debt-to-EBITDA ratio of 3.70 times, indicating a low ability to service debt.

In terms of performance, Wheels India . has underperformed the BSE 500 index in the last 3 years, 1 year, and 3 months, generating a return of -0.85%. This, coupled with its below par long-term growth, may be a cause for concern for investors.

It is worth noting that the majority shareholders of the company are promoters, which may provide some stability and confidence to investors. However, it is important to consider all factors before making any investment decisions.