Mehabe score: 6 G Factor: 2 Piotski Score: 7 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 7.
Description
KSB Pumps Limited is engaged in the business of manufacture of power driven pumps and industrial valves.Site:KSBMain Symbol:KSB
Stock trades at 1077.0, above its 50dma 1001.65. It also trades above its 200dma 820.99. The stock remains bullish on techicals
The 52 week high is at 1114.40 and the 52week low is at 425.45
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has been maintaining a healthy dividend payout of 29.45%
Weakness
– The company has delivered a poor sales growth of 8.09% over past five years.
– has a low return on equity of 10.78% for last 3 years.
Competition
– The industry trades at a mean P/E of 20.7x. KSB trades at the industry’s max P/E of 29.56x. KSB trades at a P/E of 29.6x
– Industry’s mean G-Factor is 4.2 while the mean Piotski score is 8.0. KSB has a G-Factor of 2 and Piotski scoreof 7.
– Average 1 month return for industry is 9.5%. The max 1- month return was given by Adarsh Plant: a return of 41.81 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 303.0 cr compared to Rs 219.0 cr for period ended Jun 2020, a rise of 38.4%
Operating Profits reported at Rs 39.0 cr for period ended Jun 2021 vis-vis 14.0 for period ended Jun 2020 .
Operating Margins expanded 647.9 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 7.81 compared to Rs 12.61 for previous quarter ended Mar 2021 and Rs 2.36 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1417.0 cr for period ended TTM vis-vis sales of Rs 1208.0 cr for the period ended Dec 2020, a healthy growth of 14.7%. The 3 year sales cagr stood at 9.0%.
Operating margins expanded to 17.0% for period ended TTM vis-vis 14.0% for period ended Dec 2020, expansion of 300.0 bps.
Net Profit reported at Rs 146.0 cr for period ended TTM vis-vis sales of Rs 94.0 cr for the period ended Dec 2020, rising 35.6%.
Company recorded a healthy Net Profit CAGR of 26.6% 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 11.0% compared to 11.0% over the last 3 Years. – The stock has given a return of 112% on a 1 Year basis vis-vis a return of 11% over the last 3 Years. – The compounded sales growth on a TTM bassis is 6% vis-vis a compounded sales growth of 9% over the last 3 Years. – The compounded profit growth on a TTM basis is 46% vis-vis a compounded profit growth of 10% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 2.55% vis-vis 2.68% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 19.21% vis-vis 18.93% for Mar 2021
Conclusion
– is almost debt free.
– has been maintaining a healthy dividend payout of 29.45% – The company has delivered a poor sales growth of 8.09% over past five years.
– has a low return on equity of 10.78% 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 1001.65 and is trading at 1077.0 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
