ZF Commercial Vehicle Control System India Downgraded to 'Hold' Rating by MarketsMOJO

ZF Commercial Vehicle Control System India, a leading player in the auto ancillary industry, has recently been downgraded to a 'Hold' rating by MarketsMOJO. This decision was based on the company's low Debt to Equity ratio, which is currently at 0 times.
However, the company has shown positive results for the last 8 consecutive quarters, with a PAT (HY) of Rs 206.52 crore, growing at a rate of 34.05%. Its ROCE (HY) is also at its highest at 19.94%, and it has a strong cash position with Rs 1,311.26 crore in cash and cash equivalents (HY).

Technically, the stock is in a mildly bullish range, with multiple factors such as MACD, KST, and DOW indicating a bullish trend. The majority shareholders of the company are the promoters, and it is among the top 1% of companies rated by MarketsMojo across all 4,000 stocks.

While the stock has generated a return of 66.19% in the last year, it has also consistently outperformed BSE 500 in the last 3 annual periods. However, the company has shown poor long-term growth, with net sales growing at an annual rate of 5.05% and operating profit at 2.74% over the last 5 years.

With a ROE of 15.1, the stock is currently trading at a very expensive valuation with a price to book value of 11.9. However, it is currently trading at a discount compared to its average historical valuations. Despite its strong performance in the past year, the PEG ratio of the company is 1.6, indicating that its profits have not kept up with its stock price.

Overall, while ZF Commercial Vehicle Control System India has shown positive results and a strong cash position, its long-term growth and expensive valuation make it a 'Hold' for now. Investors should keep an eye on the company's future performance and reassess their position accordingly.