Mehabe score: 3 G Factor: 1 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 1 and Piotski score of 3.
Description
Jain Irrigation Systems is engaged in providing solutions in agriculture, piping and infrastructure through manufacturing of Micro Irrigation Systems, PVC Pipes, HDPE Pipes, Plastic Sheets, Agro Processed Products, Renewable Energy Solutions, Tissue Culture Plants, Financial Services and other agricultural inputs since more than 34 years.Site:JISLJALEQS
Market Cap:
Rs 1,321 cr
Price:
26.0
Trading pe:
x
Book-value:
62.6/share
Div yield:
0.00 %
Earning yield:
-4.94%
Face-value:
2.00/share
52week high:
29.65
52week low:
9.53
Technical Analysis
Stock trades at 26.0, above its 50dma 23.23. It also trades above its 200dma 19.58. The stock remains bullish on techicals
The 52 week high is at 29.65 and the 52week low is at 9.53
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.41 times its book value
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 0.22% over past five years.
-Promoter holding is low: 28.65%
– has a low return on equity of -2.07% for last 3 years.
-Contingent liabilities of Rs.724.17 Cr.
-Promoters have pledged 49.95% of their holding.
-Earnings include an other income of Rs.34.80 Cr.
– has high debtors of 166.20 days.
Competition
– The industry trades at a mean P/E of 24.6x. Astral trades at the industry’s max P/E of 98.84x. JISLJALEQS trades at a P/E of x
– Industry’s mean G-Factor is 4.4 while the mean Piotski score is 9.0. JISLJALEQS has a G-Factor of 1 and Piotski scoreof 3.
– Average 1 month return for industry is 6.9%. The max 1- month return was given by Jai Corp: a return of 36.29 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1794.0 cr compared to Rs 1505.0 cr for period ended Mar 2020, a rise of 19.2%
Company reported operating profit of Rs 154.0 cr for period ended Mar 2021, operating profit margin at 8.6 %.
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 0.99 compared to Rs -2.4 for previous quarter ended Dec 2020 and Rs -6.53 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 5781.0 cr for period ended TTM vis-vis sales of Rs 6184.0 cr for the period ended Mar 2020, a fall of 7.0%. The 3 year sales cagr stood at -9.5%.
Operating margins expanded to 5.0% for period ended TTM vis-vis -1.0% for period ended Mar 2020, expansion of 600.0 bps.
Net Profit reported at Rs -396.0 cr for period ended TTM vis-vis sales of Rs -715.0 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 -18.0% compared to -2.0% over the last 3 Years. – The stock has given a return of 104% on a 1 Year basis vis-vis a return of -30% over the last 3 Years. – The compounded sales growth on a TTM bassis is -20% vis-vis a compounded sales growth of -3% over the last 3 Years. – The compounded profit growth on a TTM basis is -128% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has fallen for the period ended Mar 2021. The Mar 2021 fii holding stood at 5.76% vis-vis 8.53% for Dec 2020 – Public shareholding has risen for the period ended Mar 2021. The Mar 2021 public holding stood at 65.21% vis-vis 62.44% for Dec 2020
Conclusion
– Stock is trading at 0.41 times its book value – has low interest coverage ratio.
-The company has delivered a poor sales growth of 0.22% over past five years.
-Promoter holding is low: 28.65%
– has a low return on equity of -2.07% for last 3 years.
-Contingent liabilities of Rs.724.17 Cr.
-Promoters have pledged 49.95% of their holding.
-Earnings include an other income of Rs.34.80 Cr.
– has high debtors of 166.20 days.
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 23.23 and is trading at 26.0 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
