Home Investment Memo: 531268

Investment Memo: 531268

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Our Rating:

Mehabe score: 6
G Factor: 4
Piotski Score: 8
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 4 and Piotski score of 8.

Description

B2B Software Technologies is one of the most prominent and competent Microsoft Dynamics Navision Solution Center of Microsoft Dynamics and the number one partner in Telangana, India.Site: 531268Main Symbol: B2BSOFT

Price Chart

Market Cap: Rs 55.2 cr Price: 47.6 Trading pe: 29.3x
Book-value: 11.0/share Div yield: 0.00 % Earning yield: 4.61%
Face-value: 10.0/share 52week high: 55.20 52week low: 6.18

Technical Analysis

  • Stock trades at 47.6, above its 50dma 39.03. It also trades above its 200dma 24.33. The stock remains bullish on techicals
  • The 52 week high is at 55.20 and the 52week low is at 6.18

Price Chart

P/E Chart

Sales and Margin

Strengths

– is almost debt free.

Weakness

– Stock is trading at 4.33 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 7.75% over past five years.
– has a low return on equity of 9.87% for last 3 years.
-Earnings include an other income of Rs.0.91 Cr.

Competition

– The industry trades at a mean P/E of 31.9x. Happiest Minds trades at the industry’s max P/E of 135.53x. 531268 trades at a P/E of 29.3x
– Industry’s mean G-Factor is 3.8 while the mean Piotski score is 9.0. 531268 has a G-Factor of 4 and Piotski scoreof 8.
– Average 1 month return for industry is 16.9%. The max 1- month return was given by Happiest Minds: a return of 63.17 %

Quarterly Results

  • Sales for period ended Jun 2021 is Rs 4.38 cr compared to Rs 3.19 cr for period ended Jun 2020, a rise of 37.3%
  • Operating Profits reported at Rs 0.63 cr for period ended Jun 2021 vis-vis 0.33 for period ended Jun 2020 .
  • Operating Margins expanded 403.9 bps for period ended Jun 2021 vis-vis Jun 2020 .
  • The EPS for Jun 2021 was Rs 0.56 compared to Rs 0.35 for previous quarter ended Mar 2021 and Rs 0.29 for Jun 2020

Profit & Loss Statement

Profit&Loss Comments

  • Company reported sales of Rs 16.09 cr for period ended TTM vis-vis sales of Rs 14.9 cr for the period ended Mar 2021, a growth of 7.4%. The 3 year sales cagr stood at 14.8%.
  • Operating margins expanded to 11.25% for period ended TTM vis-vis 10.13% for period ended Mar 2021, expansion of 112.0 bps.
  • Net Profit reported at Rs 2.2 cr for period ended TTM vis-vis sales of Rs 1.88 cr for the period ended Mar 2021, rising 14.5%.
  • Company recorded a healthy Net Profit CAGR of 122.4% over the last 3 years

Balance Sheet Statement

Cash Flow Statement

Cash Flow comments

  • CashFlow from operating activities was positive.

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 16.0% compared to 10.0% over the last 3 Years.
– The stock has given a return of 566% on a 1 Year basis vis-vis a return of 47% over the last 3 Years.
– The compounded sales growth on a TTM bassis is 8% vis-vis a compounded sales growth of 11% over the last 3 Years.
– The compounded profit growth on a TTM basis is 107% vis-vis a compounded profit growth of 44% over the last 3 Years.

Ratios

Shareholding Pattern

– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 26.91% vis-vis 26.58% for Mar 2021

Conclusion

– is almost debt free. – Stock is trading at 4.33 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 7.75% over past five years.
– has a low return on equity of 9.87% for last 3 years.
-Earnings include an other income of Rs.0.91 Cr.

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