Mehabe score: 2 G Factor: 1 Piotski Score: 9 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 1 and Piotski score of 9.
Description
Vishal Fabrics is engaged in the business of manufacturing of wide range of textile fabrics on job work and own requirement having manufacturing fabrics.Site:VISHAL
Market Cap:
Rs 370 cr
Price:
56.2
Trading pe:
39.9x
Book-value:
36.6/share
Div yield:
0.89 %
Earning yield:
7.20%
Face-value:
5.00/share
52week high:
248.13
52week low:
40.70
Technical Analysis
Stock trades at 56.2, above its 50dma 51.28. However it is trading below its 200dma 85.69. The stock remains weak though short term bullish momentum supports price action. It needs to close above 85.69 for bullish price action to continue
The 52 week high is at 248.13 and the 52week low is at 40.70
Price Chart
P/E Chart
Sales and Margin
Strengths
– has delivered good profit growth of 26.37% CAGR over last 5 years
Weakness
– has low interest coverage ratio.
– has a low return on equity of 10.09% for last 3 years.
Competition
– The industry trades at a mean P/E of 18.1x. Alok Industries trades at the industry’s max P/E of 405.92x. VISHAL trades at a P/E of 39.9x
– Industry’s mean G-Factor is 3.0 while the mean Piotski score is 9.0. VISHAL has a G-Factor of 1 and Piotski scoreof 9.
– Average 1 month return for industry is 22.2%. The max 1- month return was given by Siyaram Silk: a return of 49.78 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 388.0 cr compared to Rs 344.0 cr for period ended Mar 2020, a rise of 12.8%
Operating Profits reported at Rs 41.0 cr for period ended Mar 2021 vis-vis 30.0 for period ended Mar 2020 .
Operating Margins expanded 184.6 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 2.12 compared to Rs 1.49 for previous quarter ended Dec 2020 and Rs 0.78 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 968.0 cr for period ended Mar 2021 vis-vis sales of Rs 1297.0 cr for the period ended Mar 2020, a fall of 34.0%. The 3 year sales cagr stood at 2.8%.
Operating margins expanded to 9.0% for period ended Mar 2021 vis-vis 8.0% for period ended Mar 2020, expansion of 100.0 bps.
Net Profit reported at Rs 18.0 cr for period ended Mar 2021 vis-vis sales of Rs 30.0 cr for the period ended Mar 2020, falling 66.7%.
Company recorded a Net Profit CAGR of 4.0% over the last 3 years
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 stock has given a return of -65% on a 1 Year basis vis-vis a return of -46% over the last 3 Years. – The compounded sales growth on a TTM bassis is -26% vis-vis a compounded sales growth of 51% over the last 3 Years. – The compounded profit growth on a TTM basis is -72% vis-vis a compounded profit growth of 50% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 5.89% vis-vis 4.62% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 25.98% vis-vis 27.24% for Dec 2020
Conclusion
– has delivered good profit growth of 26.37% CAGR over last 5 years – has low interest coverage ratio.
– has a low return on equity of 10.09% for last 3 years.
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 51.28 and is trading at 56.2 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
