Mehabe score: 6 G Factor: 2 Piotski Score: 4 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 2 and Piotski score of 4.
Description
Artson Engineering is engaged in the business of Manufacture of Structural Metal Products, Industrial & Infrastructure projects.Site:522134Main Symbol:ARTSONEN
Stock trades at 59.4, above its 50dma 53.9. It also trades above its 200dma 42.76. The stock remains bullish on techicals
The 52 week high is at 69.45 and the 52week low is at 24.20
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
Weakness
– Stock is trading at 1993.68 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 6.34% over past five years.
– has high debtors of 154.96 days.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 47.2x. Power Mech Proj. trades at the industry’s max P/E of 63.11x. 522134 trades at a P/E of x
– Industry’s mean G-Factor is 2.3 while the mean Piotski score is 4.0. 522134 has a G-Factor of 2 and Piotski scoreof 4.
– Average 1 month return for industry is 1.9%. The max 1- month return was given by Artson Engg.: a return of 26.92 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 38.98 cr compared to Rs 20.9 cr for period ended Jun 2020, a rise of 86.5%
Company reported operating profit of Rs 3.16 cr for period ended Jun 2021, operating profit margin at 8.1 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Jun 2021 was Rs 0.15 compared to Rs 0.3 for previous quarter ended Mar 2021 and Rs -1.22 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 168.0 cr for period ended TTM vis-vis sales of Rs 150.0 cr for the period ended Mar 2021, a healthy growth of 10.7%. The 3 year sales cagr stood at 2.1%.
Operating margins expanded to 6.0% for period ended TTM vis-vis 3.0% for period ended Mar 2021, expansion of 300.0 bps.
Net Profit reported at Rs -1.0 cr for period ended TTM vis-vis sales of Rs -6.0 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 16.0 cr for period ended Mar 2021 vis-vis Rs -13.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of 130% on a 1 Year basis vis-vis a return of -1% over the last 3 Years. – The compounded sales growth on a TTM bassis is 16% vis-vis a compounded sales growth of 4% over the last 3 Years. – The compounded profit growth on a TTM basis is 89% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 24.99% vis-vis 24.99% for Mar 2021
Conclusion
– has reduced debt. – Stock is trading at 1993.68 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 6.34% over past five years.
– has high debtors of 154.96 days.
-‘s cost of borrowing seems high
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 53.9 and is trading at 59.4 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
