Pritika Auto Industries Faces Significant Volatility Amid Weak Fundamentals and Declining Promoter Confidence
Pritika Auto Industries has faced notable volatility, reaching a new 52-week low and experiencing a significant decline over two days. The company's fundamentals show weaknesses, including a low Return on Capital Employed and a high Debt to EBITDA ratio. Recent quarterly results indicate a drop in profit after tax, and promoter confidence appears to be diminishing.
Pritika Auto Industries, a microcap player in the engineering sector, has experienced significant volatility today, hitting a new 52-week low of Rs. 13.36. The stock opened with a notable gap down of 18.39%, contributing to a two-day decline of 10.14%. This performance has seen Pritika Auto underperform its sector by 1.67%. The company's long-term fundamentals appear weak, with a Return on Capital Employed (ROCE) of 9.51% and a high Debt to EBITDA ratio of 2.55 times, indicating challenges in servicing debt. Over the past five years, net sales have grown at an annual rate of 13.44%, while operating profit has increased by 17.29%. However, recent quarterly results show a decline in profit after tax, falling by 19.5% compared to the previous quarter's average.
Promoter confidence seems to be waning, as their stake has decreased by 2.34% in the last quarter. Pritika Auto's performance over the past year has been particularly concerning, with a return of -47.96%, significantly lagging behind the broader market, as reflected in the Sensex's performance.
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