Mehabe score: 1 G Factor: 4 Piotski Score: 4 The stock has a rating SELL. 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 4.
Description
RPP Infra Projects is engaged in construction across multiple infrastructure verticals like roads, buildings, industrial structures, power, irrigation and water management.Site:RPPINFRAMain Symbol:RPPINFRA
Stock trades at 76.8, below its 50dma 78.06. However it is trading above its 200dma 68.01. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 78.06.
The 52 week high is at 103.50 and the 52week low is at 39.95
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.63 times its book value
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 10.30% over past five years.
– has a low return on equity of 7.55% for last 3 years.
-Promoters have pledged 57.34% of their holding.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 38.2x. Macrotech Devel. trades at the industry’s max P/E of 539.43x. RPPINFRA trades at a P/E of 11.7x
– Industry’s mean G-Factor is 4.2 while the mean Piotski score is 7.0. RPPINFRA has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 19.1%. The max 1- month return was given by National Standar: a return of 153.99 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 124.04 cr compared to Rs 85.89 cr for period ended Jun 2020, a rise of 44.4%
Operating Profits reported at Rs 11.06 cr for period ended Jun 2021 vis-vis 7.14 for period ended Jun 2020 .
Operating Margins expanded 60.4 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 1.42 compared to Rs 3.23 for previous quarter ended Mar 2021 and Rs 0.64 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 551.0 cr for period ended TTM vis-vis sales of Rs 513.0 cr for the period ended Mar 2021, a growth of 6.9%. The 3 year sales cagr stood at -1.8%.
Net Profit reported at Rs 17.0 cr for period ended TTM vis-vis sales of Rs 16.0 cr for the period ended Mar 2021, rising 5.9%.
Company reported a poor Net Profit CAGR of -9.6% 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 6.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 31% on a 1 Year basis vis-vis a return of -29% over the last 3 Years. – The compounded sales growth on a TTM bassis is -14% vis-vis a compounded sales growth of 1% over the last 3 Years. – The compounded profit growth on a TTM basis is -15% 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 1.54% vis-vis 2.82% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 41.48% vis-vis 40.17% for Mar 2021
Conclusion
– Stock is trading at 0.63 times its book value – Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 10.30% over past five years.
– has a low return on equity of 7.55% for last 3 years.
-Promoters have pledged 57.34% of their holding.
-‘s cost of borrowing seems high
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 78.06 and is trading at 76.8. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
