XPRO India Downgraded to 'Sell' by MarketsMOJO Due to High Debt and Expensive Valuation

XPRO India, a smallcap company in the plastic products industry, has recently been downgraded to a 'Sell' by MarketsMOJO. This decision was based on several factors, including the company's high debt to EBITDA ratio of 2.87 times, indicating a low ability to service debt. Additionally, with a ROE of 8.1, the company's valuation is considered to be very expensive with a 4 Price to Book Value.
Despite its size, domestic mutual funds hold only 1.3% of the company, which could suggest that they are not comfortable with the current price or the business itself. Furthermore, XPRO India has underperformed the market in the last year, with a return of only 0.37%, compared to the BSE 500's return of 34.46%.

However, there are some positive factors to consider. The company has shown healthy long-term growth, with an annual rate of 29.12% for operating profit. It has also declared positive results for the last three consecutive quarters, with a significant growth in PAT (HY) at 79.76%, and the highest DPR (Y) at 10.04%. Additionally, XPRO India has a strong cash position, with cash and cash equivalents at Rs 321.07 crore.

From a technical standpoint, the stock's trend is currently sideways, indicating no clear price momentum. The technical trend has also deteriorated since 28-Oct-24, generating a return of -2.01% since then.

In conclusion, while XPRO India may have some positive aspects, the overall outlook for the company is not favorable, leading to its downgrade to a 'Sell' by MarketsMOJO. Investors should carefully consider these factors before making any decisions regarding this smallcap company in the plastic products industry.