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
MMP Industries Ltd is engaged in manufacturing of aluminium powders/pastes, aluminium conductors and aluminium foils.Site:MMP
Market Cap:
Rs 287 cr
Price:
113.0
Trading pe:
16.5x
Book-value:
75.1/share
Div yield:
0.00 %
Earning yield:
6.56%
Face-value:
10.0/share
52week high:
120.00
52week low:
61.60
Technical Analysis
Stock trades at 113.0, above its 50dma 96.58. It also trades above its 200dma 88.55. The stock remains bullish on techicals
The 52 week high is at 120.00 and the 52week low is at 61.60
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
Weakness
– The company has delivered a poor sales growth of 5.04% over past five years.
– has a low return on equity of 11.84% for last 3 years.
-Dividend payout has been low at 4.85% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 20.1x. Arfin India trades at the industry’s max P/E of 30.01x. MMP trades at a P/E of 16.5x
– Industry’s mean G-Factor is 3.9 while the mean Piotski score is 7.0. MMP has a G-Factor of 3 and Piotski scoreof 3.
– Average 1 month return for industry is 18.3%. The max 1- month return was given by Maan Aluminium: a return of 70.89 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 77.26 cr compared to Rs 63.11 cr for period ended Mar 2020, a rise of 22.4%
Operating Profits reported at Rs 9.23 cr for period ended Mar 2021 vis-vis 5.23 for period ended Mar 2020 .
Operating Margins expanded 366.0 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 2.74 compared to Rs 1.97 for previous quarter ended Dec 2020 and Rs 1.39 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 231.0 cr for period ended Mar 2021 vis-vis sales of Rs 242.0 cr for the period ended Mar 2020, a fall of 4.8%. The 3 year sales cagr stood at -1.7%.
Operating margins expanded to 12.0% for period ended Mar 2021 vis-vis 11.0% for period ended Mar 2020, expansion of 100.0 bps.
Net Profit reported at Rs 17.0 cr for period ended Mar 2021 vis-vis sales of Rs 19.0 cr for the period ended Mar 2020, falling 11.8%.
Company reported a poor Net Profit CAGR of -3.6% 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 41% on a 1 Year basis vis-vis a return of -5% over the last 3 Years. – The compounded sales growth on a TTM bassis is -5% vis-vis a compounded sales growth of -2% over the last 3 Years. – The compounded profit growth on a TTM basis is -6% vis-vis a compounded profit growth of -3% over the last 3 Years.
Ratios
Conclusion
– is almost debt free. – The company has delivered a poor sales growth of 5.04% over past five years.
– has a low return on equity of 11.84% for last 3 years.
-Dividend payout has been low at 4.85% of profits over 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 96.58 and is trading at 113.0 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
