Mehabe score: 2 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
Morarka Finance is engaged in Business of Dividend Income and Management Consultancy Fees.Site:511549Main Symbol:MORARKFI
Stock trades at 56.6, above its 50dma 48.8. It also trades above its 200dma 37.61. The stock remains bullish on techicals
The 52 week high is at 64.50 and the 52week low is at 20.65
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.35 times its book value
Weakness
– has a low return on equity of 8.69% for last 3 years.
Competition
– The industry trades at a mean P/E of 24.8x. SBI Cards trades at the industry’s max P/E of 94.47x. 511549 trades at a P/E of 36.9x
– Industry’s mean G-Factor is 4.4 while the mean Piotski score is 6.0. 511549 has a G-Factor of 3 and Piotski scoreof 3.
– Average 1 month return for industry is 1.9%. The max 1- month return was given by Morarka Finance: a return of 27.36 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 0.25 cr compared to Rs 2.42 cr for period ended Mar 2020, a fall of 89.7%
Operating Profits reported at Rs 0.16 cr for period ended Mar 2021 vis-vis 2.29 for period ended Mar 2020 .
Operating Margins contracted -3062.8 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.31 compared to Rs 0.27 for previous quarter ended Dec 2020 and Rs 5.11 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1.27 cr for period ended Mar 2021 vis-vis sales of Rs 5.43 cr for the period ended Mar 2020, a fall of 327.6%. The 3 year sales cagr stood at -22.7%.
Operating margins shrank to 71.65% for period ended Mar 2021 vis-vis 91.71% for period ended Mar 2020, contraction of 2006.0 bps.
Net Profit reported at Rs 0.69 cr for period ended Mar 2021 vis-vis sales of Rs 4.95 cr for the period ended Mar 2020, falling 617.4%.
Company reported a poor Net Profit CAGR of -33.4% 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 company has worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 2.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 136% on a 1 Year basis vis-vis a return of 39% over the last 3 Years. – The compounded sales growth on a TTM bassis is -77% vis-vis a compounded sales growth of -23% over the last 3 Years. – The compounded profit growth on a TTM basis is -86% vis-vis a compounded profit growth of -33% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 34.72% vis-vis 34.72% for Dec 2020
Conclusion
– is almost debt free.
-Stock is trading at 0.35 times its book value – has a low return on equity of 8.69% 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 48.8 and is trading at 56.6 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
