Zeal Aqua Receives Upgraded Stock Call from MarketsMOJO, Shows Strong Performance in Recent Quarter

Zeal Aqua, a microcap company in the aquaculture industry, has recently received an upgraded stock call from MarketsMOJO. The stock has been upgraded to a 'Hold' rating, indicating a neutral stance for investors.
The company has shown positive results in the third quarter of 2024, with a growth of 121.7% in its PAT(Q) at Rs 2.35 crore. Its NET SALES(Q) have also reached a record high of Rs 152.16 crore. These numbers reflect a strong performance by the company in the recent quarter.

Technically, the stock is in a mildly bullish range and has shown improvement since November 4, 2024, with a return of -2.45%. The MACD and KST technical factors are also bullish, indicating a positive trend for the stock.

With a ROCE of 6.8, Zeal Aqua has an attractive valuation with a 1.3 Enterprise value to Capital Employed. The stock is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 57.85%, while its profits have increased by 77.5%. The PEG ratio of the company is 0.2, indicating a potential undervaluation.

The majority shareholders of Zeal Aqua are the promoters, which can be seen as a positive sign for investors. The stock has also outperformed the market (BSE 500) with a return of 57.85% in the last year, compared to the market's return of 31.95%.

However, the company's long-term fundamental strength is weak, with an average ROCE of 5.42%. Its growth in Net Sales and Operating profit over the last 5 years has been at a slow rate of 16.49% and 11.63%, respectively. Additionally, the company has a high Debt to EBITDA ratio of 6.95 times, indicating a low ability to service debt.

In conclusion, while Zeal Aqua has shown a strong performance in the recent quarter and has potential for growth, its long-term fundamentals and high debt levels should be considered by investors before making any investment decisions.