Mehabe score: 4 G Factor: 5 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 5 and Piotski score of 3.
Description
Lords Chloro Alkali is primarily engaged in the business of manufacturing of caustic soda and other chemicals.(Source : 201903 Annual Report Page No:82)Site:500284Main Symbol:LORDSCHLO
Stock trades at 49.5, above its 50dma 37.79. It also trades above its 200dma 34.75. The stock remains bullish on techicals
The 52 week high is at 46.95 and the 52week low is at 27.70
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 9.52% over past five years.
– has a low return on equity of 13.81% for last 3 years.
– might be capitalizing the interest cost
-Earnings include an other income of Rs.3.23 Cr.
-Debtor days have increased from 31.34 to 50.47 days.
Competition
– The industry trades at a mean P/E of 28.7x. Punjab Alkalies trades at the industry’s max P/E of 43.89x. 500284 trades at a P/E of x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 8.0. 500284 has a G-Factor of 5 and Piotski scoreof 3.
– Average 1 month return for industry is 13.9%. The max 1- month return was given by Lords Chloro: a return of 34.33 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 44.56 cr compared to Rs 22.17 cr for period ended Jun 2020, a rise of 101.0%
Operating Profits reported at Rs 5.37 cr for period ended Jun 2021 vis-vis 1.18 for period ended Jun 2020 .
Operating Margins expanded 672.9 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 0.81 compared to Rs 0.2 for previous quarter ended Mar 2021 and Rs -0.43 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 176.0 cr for period ended TTM vis-vis sales of Rs 154.0 cr for the period ended Mar 2021, a healthy growth of 12.5%. The 3 year sales cagr stood at -11.2%.
Operating margins expanded to 5.0% for period ended TTM vis-vis 3.0% for period ended Mar 2021, expansion of 200.0 bps.
Net Profit reported at Rs 1.0 cr for period ended TTM vis-vis sales of Rs -2.0 cr for the period ended Mar 2021, rising 300.0%.
Company reported a poor Net Profit CAGR of -64.8% 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 14.0% over the last 3 Years. – The stock has given a return of 59% on a 1 Year basis vis-vis a return of 2% over the last 3 Years. – The compounded sales growth on a TTM bassis is -24% vis-vis a compounded sales growth of -2% over the last 3 Years. – The compounded profit growth on a TTM basis is -119% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 31.22% vis-vis 31.22% for Dec 2020
Conclusion
– – has low interest coverage ratio.
-The company has delivered a poor sales growth of 9.52% over past five years.
– has a low return on equity of 13.81% for last 3 years.
– might be capitalizing the interest cost
-Earnings include an other income of Rs.3.23 Cr.
-Debtor days have increased from 31.34 to 50.47 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 37.79 and is trading at 49.5 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
