Mehabe score: 4 G Factor: 4 Piotski Score: 5 The stock has a rating 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 4 and Piotski score of 5.
Description
Alkali Metals originally set up for manufacturing of Sodium Metal, the company subsequently diversified into manufacturing of Sodium derivatives, Pyridine derivatives, Fine Chemicals and APIs etc. The company is recognised as an Export House by DGFT and also recognised by Dept. of Science and Technology, New Delhi as an approved In house R & D Facility.Site:ALKALIMain Symbol:ALKALI
Stock trades at 88.2, above its 50dma 74.33. It also trades above its 200dma 60.12. The stock remains bullish on techicals
The 52 week high is at 98.50 and the 52week low is at 41.10
Price Chart
P/E Chart
Sales and Margin
Strengths
– has been maintaining a healthy dividend payout of 28.81%
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -5.45% over past five years.
– has a low return on equity of 0.72% for last 3 years.
-Promoters have pledged 30.04% of their holding.
-Debtor days have increased from 55.54 to 79.02 days.
Competition
– The industry trades at a mean P/E of 29.4x. Pidilite Inds. trades at the industry’s max P/E of 102.37x. ALKALI trades at a P/E of x
– Industry’s mean G-Factor is 3.8 while the mean Piotski score is 8.0. ALKALI has a G-Factor of 4 and Piotski scoreof 5.
– Average 1 month return for industry is 16.2%. The max 1- month return was given by Gujarat Fluoroch: a return of 52.36 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 16.49 cr compared to Rs 11.54 cr for period ended Mar 2020, a rise of 42.9%
Company reported operating profit of Rs 1.4 cr for period ended Mar 2021, operating profit margin at 8.5 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Mar 2021 was Rs -1.49 compared to Rs 1.06 for previous quarter ended Dec 2020 and Rs -2.21 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 55.38 cr for period ended Mar 2021 vis-vis sales of Rs 70.85 cr for the period ended Mar 2020, a fall of 27.9%. The 3 year sales cagr stood at -5.2%.
Operating margins expanded to 10.94% for period ended Mar 2021 vis-vis 9.43% for period ended Mar 2020, expansion of 151.0 bps.
Net Profit reported at Rs -1.21 cr for period ended Mar 2021 vis-vis sales of Rs 1.25 cr for the period ended Mar 2020, falling 0%.
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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -4.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 104% 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 -22% vis-vis a compounded sales growth of -5% over the last 3 Years. – The compounded profit growth on a TTM basis is -241% 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 30.36% vis-vis 30.36% for Mar 2021
Conclusion
– has been maintaining a healthy dividend payout of 28.81% – has low interest coverage ratio.
-The company has delivered a poor sales growth of -5.45% over past five years.
– has a low return on equity of 0.72% for last 3 years.
-Promoters have pledged 30.04% of their holding.
-Debtor days have increased from 55.54 to 79.02 days.
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 74.33 and is trading at 88.2, thus bullish price action wise.
