Zuari Agro Chemicals Receives 'Hold' Rating and Shows Positive Growth in Recent Quarter

Zuari Agro Chemicals, a microcap company in the fertilizer industry, has recently received a 'Hold' rating from MarketsMOJO on November 11, 2024. This upgrade comes after the company declared positive results in September 2024, following two consecutive negative quarters.
The company's PBT LESS OI(Q) has reached a high of Rs 96.76 crore, while its PAT(Q) and EPS(Q) have also shown significant improvement. Additionally, the stock is currently in a Mildly Bullish range and has generated a return of 5.15% since November 7, 2024. Technical indicators such as MACD, Bollinger Band, KST, and OBV are all pointing towards a bullish trend for the stock.

Moreover, with a ROCE of 7.5, the stock is currently trading at a discount compared to its historical valuations. However, it is important to note that the company has a high debt to equity ratio of 4.85 times and has shown poor long-term growth in terms of net sales and operating profit. This has resulted in a low return on equity of 7.76%.

Furthermore, 46.81% of the company's promoter shares are pledged, which could put additional downward pressure on the stock prices in falling markets. Despite this, Zuari Agro Chemicals has outperformed the BSE 500 index in the last 3 years, 1 year, and 3 months, and has generated a return of 45.58% in the last year.

In conclusion, while the recent upgrade to 'Hold' by MarketsMOJO may indicate a positive outlook for Zuari Agro Chemicals, investors should also consider the company's high debt and weak long-term fundamental strength before making any investment decisions.