Mehabe score: 2 G Factor: 2 Piotski Score: 3 The stock has a rating SELL. 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 2 and Piotski score of 3.
Description
Mehai Tech is engaged in the business of Manufacturing of Electronic Lighting Equipment, Wholesale of computers, computer peripheral equipment and software, Trading in Paper, Trading in chemicals.Site:540730
Market Cap:
Rs 66.5 cr
Price:
62.0
Trading pe:
x
Book-value:
11.8/share
Div yield:
0.00 %
Earning yield:
-0.57%
Face-value:
10.0/share
52week high:
105.00
52week low:
10.07
Technical Analysis
Stock trades at 62.0, below its 50dma 65.91. However it is trading above its 200dma 56.9. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 65.91.
The 52 week high is at 105.00 and the 52week low is at 10.07
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
Weakness
– Stock is trading at 5.27 times its book value
– has low interest coverage ratio.
– has a low return on equity of 0.79% for last 3 years.
Competition
– The industry trades at a mean P/E of 25.0x. A B B trades at the industry’s max P/E of 151.94x. 540730 trades at a P/E of x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 8.0. 540730 has a G-Factor of 2 and Piotski scoreof 3.
– Average 1 month return for industry is 1.2%. The max 1- month return was given by A B B: a return of 18.36 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 0.74 cr compared to Rs 4.23 cr for period ended Mar 2020, a fall of 82.5%
Company reported operating profit of Rs 0.1 cr for period ended Mar 2021, operating profit margin at 13.5 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Mar 2021 was Rs 0.05 compared to Rs 0.01 for previous quarter ended Dec 2020 and Rs -0.27 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 5.08 cr for period ended Mar 2021 vis-vis sales of Rs 24.54 cr for the period ended Mar 2020, a fall of 383.1%. The 3 year sales cagr stood at -1.7%.
Operating margins expanded to 4.92% for period ended Mar 2021 vis-vis -0.24% for period ended Mar 2020, expansion of 516.0 bps.
Net Profit reported at Rs 0.09 cr for period ended Mar 2021 vis-vis sales of Rs -0.07 cr for the period ended Mar 2020, rising 177.8%.
Company reported a poor Net Profit CAGR of -3.5% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities: Rs 0.0 cr for period ended Mar 2021 vis-vis Rs -1.17 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of 113% on a 1 Year basis vis-vis a return of 3% over the last 3 Years. – The compounded sales growth on a TTM bassis is 18% vis-vis a compounded sales growth of 68% over the last 3 Years. – The compounded profit growth on a TTM basis is -132% 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 28.05% vis-vis 28.05% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free. – Stock is trading at 5.27 times its book value
– has low interest coverage ratio.
– has a low return on equity of 0.79% for last 3 years.
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 65.91 and is trading at 62.0. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
