Mehabe score: 4 G Factor: 7 Piotski Score: 5 The stock has a rating . 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 7 and Piotski score of 5.
Description
Canara Bank was founded in 1906 in Mangalore. Its segments include Treasury Operations, Retail Banking Operations, Wholesale Banking Operations and Other Banking Operations. It has completed over a century in the industry and occupies a premier position in the comity of Indian banks.#
Main Points
Ratios
Capital Adequacy Ratio – 13.69%#
Net Interest Margin – 2.80%#
Gross NPA – 7.46%
Net NPA – 2.64%#
CASA Ratio – 33.41%Site:CANBKMain Symbol:CANBK
Stock trades at 151.0, below its 50dma 152.02. However it is trading above its 200dma 140.59. 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 152.02.
The 52 week high is at 174.60 and the 52week low is at 82.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.60 times its book value
– is expected to give good quarter
– has delivered good profit growth of 25.46% CAGR over last 5 years
Weakness
– has low interest coverage ratio.
– has a low return on equity of 1.28% for last 3 years.
-Contingent liabilities of Rs.409652.77 Cr.
-Earnings include an other income of Rs.23447.15 Cr.
-Promoter holding has decreased over last 3 years: -3.22%
Competition
– The industry trades at a mean P/E of 14.6x. I O B trades at the industry’s max P/E of 59.45x. CANBK trades at a P/E of 8.61x
– Industry’s mean G-Factor is 5.0 while the mean Piotski score is 8.0. CANBK has a G-Factor of 7 and Piotski scoreof 5.
– Average 1 month return for industry is 2.1%. The max 1- month return was given by I O B: a return of 29.14 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 16576.0 cr compared to Rs 12249.0 cr for period ended Mar 2020, a rise of 35.3%
Operating Profits reported at Rs 11408.0 cr for period ended Mar 2021 vis-vis 9818.0 for period ended Mar 2020 .
Operating Margins contracted -1133.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 7.26 compared to Rs 4.55 for previous quarter ended Dec 2020 and Rs -31.16 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 70213.0 cr for period ended Mar 2021 vis-vis sales of Rs 49759.0 cr for the period ended Mar 2020, a healthy growth of 29.1%. The 3 year sales cagr stood at 19.3%.
Operating margins shrank to -19566.0% for period ended Mar 2021 vis-vis -12866.0% for period ended Mar 2020, contraction of 670000.0 bps.
Net Profit reported at Rs 2891.0 cr for period ended Mar 2021 vis-vis sales of Rs -1986.0 cr for the period ended Mar 2020, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 59118.0 cr for period ended Mar 2021 vis-vis Rs -5288.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 7.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 45% on a 1 Year basis vis-vis a return of -15% over the last 3 Years. – The compounded sales growth on a TTM bassis is 41% vis-vis a compounded sales growth of 19% over the last 3 Years. – The compounded profit growth on a TTM basis is 246% vis-vis a compounded profit growth of 40% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 4.59% vis-vis 4.48% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 13.48% vis-vis 14.23% for Dec 2020
Conclusion
– Stock is trading at 0.60 times its book value
– is expected to give good quarter
– has delivered good profit growth of 25.46% CAGR over last 5 years – has low interest coverage ratio.
– has a low return on equity of 1.28% for last 3 years.
-Contingent liabilities of Rs.409652.77 Cr.
-Earnings include an other income of Rs.23447.15 Cr.
-Promoter holding has decreased over last 3 years: -3.22%
