Mehabe score: 5 G Factor: 4 Piotski Score: 7 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 7.
Description
Tata Investment Corporation Ltd is primarily engaged in the business of investment in listed and unlisted equity shares, debt instruments and mutual funds etc. of companies in a wide range of industries.
The company is a NBFC registered with the RBI under the category of Investment Company.#
Main Points
Investment Portfolio
The company has a diversified investments portfolio that consists of investments in companies in the form of equity & bonds. Presently, the company is invested in ~88 companies out of which 69 are quoted and 19 are unquoted.#
Stock trades at 1264.0, above its 50dma 1137.53. It also trades above its 200dma 1044.06. The stock remains bullish on techicals
The 52 week high is at 1305.00 and the 52week low is at 761.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.45 times its book value
– has been maintaining a healthy dividend payout of 85.04%
Weakness
– The company has delivered a poor sales growth of -7.98% over past five years.
-Tax rate seems low
– has a low return on equity of 1.39% for last 3 years.
Competition
– The industry trades at a mean P/E of 24.7x. SBI Cards trades at the industry’s max P/E of 107.94x. TATAINVEST trades at a P/E of 41.5x
– Industry’s mean G-Factor is 2.9 while the mean Piotski score is 7.0. TATAINVEST has a G-Factor of 4 and Piotski scoreof 7.
– Average 1 month return for industry is 4.2%. The max 1- month return was given by Bajaj Finserv: a return of 10.8 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 30.92 cr compared to Rs 21.41 cr for period ended Mar 2020, a rise of 44.4%
Company reported operating profit of Rs 7.03 cr for period ended Mar 2021, operating profit margin at 22.7 %.
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 0.53 compared to Rs 5.44 for previous quarter ended Dec 2020 and Rs -7.17 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 163.0 cr for period ended Mar 2021 vis-vis sales of Rs 144.0 cr for the period ended Mar 2020, a healthy growth of 11.7%. The 3 year sales cagr stood at 1.0%.
Operating margins expanded to 88.0% for period ended Mar 2021 vis-vis 71.0% for period ended Mar 2020, expansion of 1700.0 bps.
Net Profit reported at Rs 154.0 cr for period ended Mar 2021 vis-vis sales of Rs 91.0 cr for the period ended Mar 2020, rising 40.9%.
Company recorded a Net Profit CAGR of 5.5% 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 1.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 64% on a 1 Year basis vis-vis a return of 17% over the last 3 Years. – The compounded sales growth on a TTM bassis is 13% vis-vis a compounded sales growth of 1% over the last 3 Years. – The compounded profit growth on a TTM basis is 70% vis-vis a compounded profit growth of 6% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 1.73% vis-vis 1.99% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 23.92% vis-vis 23.2% for Mar 2021
Conclusion
– is almost debt free.
-Stock is trading at 0.45 times its book value
– has been maintaining a healthy dividend payout of 85.04% – The company has delivered a poor sales growth of -7.98% over past five years.
-Tax rate seems low
– has a low return on equity of 1.39% for last 3 years.
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 1137.53 and is trading at 1264.0, thus bullish price action wise.
