Mehabe score: 2 G Factor: 7 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 7 and Piotski score of 4.
Description
Incorporated in 1987, Asian Tea & Exports Limited is Kolkata based company promoted by Garg family and is engaged in trading/exporting of agro commodities including tea, rice, Sugar & pulses.
Converted into Public Limited company in 1994, it exports tea to countries like China, Russia, Vietnam Iran through its associate company Asian Tea Company Private Limited.
Main Points
Leading House of Tea
Asian Tea & Exports is a leading house of Tea and is engaged in tea plantations, manufacturing, exporting and trading of Tea. It is recognised as Star Export House by the Government of India. #Site:519532Main Symbol:ASIANTNE
Stock trades at 18.4, below its 50dma 19.77. However it is trading above its 200dma 17.43. 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 19.77.
The 52 week high is at 27.45 and the 52week low is at 12.83
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.45 times its book value
– is expected to give good quarter
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
-Tax rate seems low
– has a low return on equity of 6.95% for last 3 years.
-Earnings include an other income of Rs.5.80 Cr.
Competition
– The industry trades at a mean P/E of 10.3x. Tata Consumer trades at the industry’s max P/E of 101.61x. 519532 trades at a P/E of 5.01x
– Industry’s mean G-Factor is 3.2 while the mean Piotski score is 9.0. 519532 has a G-Factor of 7 and Piotski scoreof 4.
– Average 1 month return for industry is -13.7%. The max 1- month return was given by Tata Consumer: a return of 12.33 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 16.34 cr compared to Rs 10.92 cr for period ended Jun 2020, a rise of 49.6%
Company reported operating profit of Rs 0.82 cr for period ended Jun 2021, operating profit margin at 5.0 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Jun 2021 was Rs 0.38 compared to Rs 0.0 for previous quarter ended Mar 2021 and Rs 0.18 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 124.0 cr for period ended TTM vis-vis sales of Rs 118.0 cr for the period ended Mar 2021, a growth of 4.8%. The 3 year sales cagr stood at -6.8%.
Operating margins expanded to 3.0% for period ended TTM vis-vis 2.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 4.0 cr for period ended TTM vis-vis sales of Rs 4.0 cr for the period ended Mar 2021,
Company recorded a healthy Net Profit CAGR of 58.7% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
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 9.0% compared to 7.0% over the last 3 Years. – The stock has given a return of 4% on a 1 Year basis vis-vis a return of 35% over the last 3 Years. – The compounded sales growth on a TTM bassis is -50% vis-vis a compounded sales growth of 123% over the last 3 Years. – The compounded profit growth on a TTM basis is 32% vis-vis a compounded profit growth of 60% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 34.18% vis-vis 34.18% for Mar 2021
Conclusion
– Stock is trading at 0.45 times its book value
– is expected to give good quarter – Though the company is reporting repeated profits, it is not paying out dividend
-Tax rate seems low
– has a low return on equity of 6.95% for last 3 years.
-Earnings include an other income of Rs.5.80 Cr.
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 19.77 and is trading at 18.4. 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
