Mehabe score: 3 G Factor: 3 Piotski Score: 3 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 3.
Description
Bharat Gears is engaged in the business of Manufacture of Automobile Gears.Site:BHARATGEAR
Market Cap:
Rs 100 cr
Price:
108.0
Trading pe:
x
Book-value:
68.9/share
Div yield:
0.00 %
Earning yield:
3.04%
Face-value:
10.0/share
52week high:
119.00
52week low:
38.20
Technical Analysis
Stock trades at 108.0, above its 50dma 92.31. It also trades above its 200dma 75.2. The stock remains bullish on techicals
The 52 week high is at 119.00 and the 52week low is at 38.20
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 2.22% over past five years.
– has a low return on equity of 0.09% for last 3 years.
Competition
– The industry trades at a mean P/E of 33.1x. Minda Industries trades at the industry’s max P/E of 199.1x. BHARATGEAR trades at a P/E of x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 7.0. BHARATGEAR has a G-Factor of 3 and Piotski scoreof 3.
– Average 1 month return for industry is 7.6%. The max 1- month return was given by Bharat Gears: a return of 23.82 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 174.03 cr compared to Rs 110.61 cr for period ended Mar 2020, a rise of 57.3%
Operating Profits reported at Rs 13.92 cr for period ended Mar 2021 vis-vis 6.16 for period ended Mar 2020 .
Operating Margins expanded 243.0 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 2.98 compared to Rs 5.09 for previous quarter ended Dec 2020 and Rs -2.34 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 503.0 cr for period ended Mar 2021 vis-vis sales of Rs 463.0 cr for the period ended Mar 2020, a growth of 8.0%. The 3 year sales cagr stood at -0.3%.
Operating margins expanded to 7.0% for period ended Mar 2021 vis-vis 4.0% for period ended Mar 2020, expansion of 300.0 bps.
Net Profit reported at Rs -8.0 cr for period ended Mar 2021 vis-vis sales of Rs -19.0 cr for the period ended Mar 2020, rising 0%.
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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -22.0% compared to 0.0% over the last 3 Years. – The stock has given a return of 157% on a 1 Year basis vis-vis a return of -14% over the last 3 Years. – The compounded sales growth on a TTM bassis is -11% vis-vis a compounded sales growth of 4% over the last 3 Years. – The compounded profit growth on a TTM basis is 22% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 44.65% vis-vis 44.65% for Dec 2020
Conclusion
– has reduced debt. – has low interest coverage ratio.
-The company has delivered a poor sales growth of 2.22% over past five years.
– has a low return on equity of 0.09% 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 92.31 and is trading at 108.0 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
