Mehabe score: 6 G Factor: 3 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 3 and Piotski score of 4.
Description
Ajooni Biotech is engaged in the business of manufacturing of cattle feed and focuses on optimization of productivity, satisfaction of all nutritional needs of animals and achievement of the best balance in their diet.Site:AJOONIMain Symbol:www.nseindia.com
Stock trades at 61.8, above its 50dma 53.86. It also trades above its 200dma 39.7. The stock remains bullish on techicals
The 52 week high is at 75.70 and the 52week low is at 15.53
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 3.95 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -0.80%
– has a low return on equity of 2.61% for last 3 years.
Competition
– The industry trades at a mean P/E of 29.2x. Ajooni Biotech trades at the industry’s max P/E of 167.11x. AJOONI trades at a P/E of 167.0x
– Industry’s mean G-Factor is 3.9 while the mean Piotski score is 9.0. AJOONI has a G-Factor of 3 and Piotski scoreof 4.
– Average 1 month return for industry is 12.3%. The max 1- month return was given by C D S L: a return of 35.11 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 15.86 cr compared to Rs 12.9 cr for period ended Mar 2020, a rise of 22.9%
Operating Profits reported at Rs 0.73 cr for period ended Jun 2021 vis-vis 0.54 for period ended Mar 2020 .
Operating Margins expanded 41.7 bps for period ended Jun 2021 vis-vis Mar 2020 .
The EPS for Jun 2021 was Rs 0.31 compared to Rs 0.04 for previous quarter ended Mar 2021 and Rs 0.25 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 51.06 cr for period ended Mar 2021 vis-vis sales of Rs 40.03 cr for the period ended Mar 2020, a healthy growth of 21.6%. The 3 year sales cagr stood at 6.5%.
Operating margins expanded to 3.25% for period ended Mar 2021 vis-vis 3.1% for period ended Mar 2020, expansion of 15.0 bps.
Net Profit reported at Rs 0.37 cr for period ended Mar 2021 vis-vis sales of Rs 0.35 cr for the period ended Mar 2020, rising 5.4%.
Company reported a poor Net Profit CAGR of -1.7% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 1.16 cr for period ended Mar 2021 vis-vis Rs -4.38 cr for period ended Mar 2020
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 2.0% compared to 3.0% over the last 3 Years. – The stock has given a return of 272% on a 1 Year basis vis-vis a return of 59% over the last 3 Years. – The compounded sales growth on a TTM bassis is 28% vis-vis a compounded sales growth of 6% over the last 3 Years. – The compounded profit growth on a TTM basis is 23% vis-vis a compounded profit growth of -1% over the last 3 Years.
Ratios
Conclusion
– – Stock is trading at 3.95 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -0.80%
– has a low return on equity of 2.61% 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 53.86 and is trading at 61.8 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
