Mehabe score: 1 G Factor: 4 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 4 and Piotski score of 4.
Description
B.C. Power Controls is engaged in manufacturing of Insulated Wire and Cable, Trading Ferrous & Non Ferrous Metal.Site:BCP
Market Cap:
Rs 23.7 cr
Price:
3.95
Trading pe:
57.8x
Book-value:
5.41/share
Div yield:
0.00 %
Earning yield:
5.22%
Face-value:
2.00/share
52week high:
8.70
52week low:
2.85
Technical Analysis
Stock trades at 3.95, above its 50dma 3.71. However it is trading below its 200dma 5.33. The stock remains weak though short term bullish momentum supports price action. It needs to close above 5.33 for bullish price action to continue
The 52 week high is at 8.70 and the 52week low is at 2.85
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
-Stock is trading at 0.73 times its book value
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -7.09%
-The company has delivered a poor sales growth of -2.90% over past five years.
-Promoter holding is low: 14.91%
– has a low return on equity of 9.81% for last 3 years.
-Earnings include an other income of Rs.0.58 Cr.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 38.6x. Ultracab India trades at the industry’s max P/E of 95.88x. BCP trades at a P/E of 57.8x
– Industry’s mean G-Factor is 3.1 while the mean Piotski score is 7.0. BCP has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 15.6%. The max 1- month return was given by Paramount Comm.: a return of 34.16 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 22.71 cr compared to Rs 30.56 cr for period ended Mar 2020, a fall of 25.7%
Company reported operating profit of Rs 0.32 cr for period ended Mar 2021, operating profit margin at 1.4 %.
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 -0.07 compared to Rs 0.01 for previous quarter ended Dec 2020 and Rs -0.07 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 150.0 cr for period ended Mar 2021 vis-vis sales of Rs 193.0 cr for the period ended Mar 2020, a fall of 28.7%. The 3 year sales cagr stood at -32.7%.
Net Profit reported at Rs 0.0 cr for period ended Mar 2021 vis-vis sales of Rs 1.0 cr for the period ended Mar 2020, falling 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 3.0% compared to 10.0% over the last 3 Years. – The stock has given a return of -29% on a 1 Year basis vis-vis a return of -52% over the last 3 Years. – The compounded sales growth on a TTM bassis is -37% vis-vis a compounded sales growth of -18% over the last 3 Years. – The compounded profit growth on a TTM basis is -77% vis-vis a compounded profit growth of 15% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 9.08% vis-vis 10.43% for Dec 2020 – Public shareholding has risen for the period ended Mar 2021. The Mar 2021 public holding stood at 75.54% vis-vis 67.57% for Dec 2020
Conclusion
– has reduced debt.
-Stock is trading at 0.73 times its book value – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -7.09%
-The company has delivered a poor sales growth of -2.90% over past five years.
-Promoter holding is low: 14.91%
– has a low return on equity of 9.81% for last 3 years.
-Earnings include an other income of Rs.0.58 Cr.
-‘s cost of borrowing seems high
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 3.71 and is trading at 3.95 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
