Indoco Remedies, a smallcap pharmaceutical company, has received a 'Hold' rating from MarketsMojo due to its strong ability to service debt, healthy long-term growth, and attractive valuation. However, the company has faced challenges in the past year, leading to a -46% decrease in profits. Despite this, it has a high institutional holding and has underperformed the market in the last year. Investors should carefully consider all factors before investing.

Indoco Remedies, a smallcap pharmaceutical company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade is based on several factors that indicate a neutral outlook for the company.

One of the key reasons for the 'Hold' rating is Indoco Remedies' strong ability to service debt. With a low Debt to EBITDA ratio of 1.40 times, the company is in a good position to manage its debt obligations. Additionally, the company has shown healthy long-term growth, with its operating profit growing at an annual rate of 154.96%.

Technically, the stock is currently in a Mildly Bullish range and has shown improvement from a Sideways trend on 21-Aug-24. The Bollinger Band, a key technical factor, has also been Bullish since 21 Aug 2024.

From a valuation perspective, Indoco Remedies is trading at a discount compared to its average historical valuations. Its ROCE of 8.7 and Enterprise value to Capital Employed ratio of 2.2 make it an attractive option for investors.

However, the company has faced challenges in the past year, with a -46% decrease in profits despite a 7.05% return for investors. This can be attributed to a -4.04% fall in net sales and negative results for the last 7 consecutive quarters. The company's PAT(Q) has also fallen by -88.5% and its ROCE(HY) is at its lowest at 9.11%. The DEBT-EQUITY RATIO(HY) is also at its highest at 0.61 times.

Despite these challenges, Indoco Remedies has a high institutional holding of 20.14%, indicating that these investors have better capability and resources to analyze the company's fundamentals.

In the last 1 year, Indoco Remedies has underperformed the market, with a return of 7.05% compared to the market's (BSE 500) return of 38.03%. This further supports the 'Hold' rating for the stock.

Overall, while Indoco Remedies has shown some positive indicators, it is important for investors to carefully consider all factors before making any investment decisions.