Mehabe score: 2 G Factor: 3 Piotski Score: 4 The stock has a rating OBSERVE & HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 3 and Piotski score of 4.
Description
United Nilgiri Tea Estates Company is primarily engaged in growing and manufacture of Tea besides Letting-out of property.Site:UNITEDTEA
Market Cap:
Rs 178 cr
Price:
356.0
Trading pe:
14.1x
Book-value:
322/share
Div yield:
0.76 %
Earning yield:
9.83%
Face-value:
10.0/share
52week high:
390.00
52week low:
208.05
Technical Analysis
Stock trades at 356.0, above its 50dma 322.55. It also trades above its 200dma 309.86. The stock remains bullish on techicals
The 52 week high is at 390.00 and the 52week low is at 208.05
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 1.11 times its book value
Weakness
– The company has delivered a poor sales growth of 4.40% over past five years.
– has a low return on equity of 9.31% for last 3 years.
-Earnings include an other income of Rs.6.73 Cr.
-Dividend payout has been low at 11.04% of profits over last 3 years
-Debtor days have increased from 32.69 to 41.83 days.
Competition
– The industry trades at a mean P/E of 15.4x. Tata Consumer trades at the industry’s max P/E of 75.07x. UNITEDTEA trades at a P/E of 14.1x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 9.0. UNITEDTEA has a G-Factor of 3 and Piotski scoreof 4.
– Average 1 month return for industry is 14.7%. The max 1- month return was given by Mcleod Russel: a return of 56.89 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 12.81 cr compared to Rs 16.24 cr for period ended Mar 2020, a fall of 21.1%
Company reported negative operating profit of Rs -0.46 cr for period ended Mar 2021. For same period last year, operating profit was 1.49
The EPS for Mar 2021 was Rs -0.54 compared to Rs 9.27 for previous quarter ended Dec 2020 and Rs 0.3 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 66.0 cr for period ended Mar 2021 vis-vis sales of Rs 63.0 cr for the period ended Mar 2020, a growth of 4.5%. The 3 year sales cagr stood at 2.1%.
Operating margins shrank to 16.0% for period ended Mar 2021 vis-vis 20.0% for period ended Mar 2020, contraction of 400.0 bps.
Net Profit reported at Rs 12.0 cr for period ended Mar 2021 vis-vis sales of Rs 11.0 cr for the period ended Mar 2020, rising 8.3%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 7.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 50% on a 1 Year basis vis-vis a return of -2% over the last 3 Years. – The compounded sales growth on a TTM bassis is 21% vis-vis a compounded sales growth of 5% over the last 3 Years. – The compounded profit growth on a TTM basis is -1% vis-vis a compounded profit growth of 5% over the last 3 Years.
Ratios
Conclusion
– is almost debt free.
-Stock is trading at 1.11 times its book value – The company has delivered a poor sales growth of 4.40% over past five years.
– has a low return on equity of 9.31% for last 3 years.
-Earnings include an other income of Rs.6.73 Cr.
-Dividend payout has been low at 11.04% of profits over last 3 years
-Debtor days have increased from 32.69 to 41.83 days.
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 322.55 and is trading at 356.0 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
