Mehabe score: 1 G Factor: 3 Piotski Score: 2 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 3 and Piotski score of 2.
Description
ARSS Infrastructure Projects is engaged in execution of contracts of various infrastracture projects including road work,bridge work, railway tracking and irrigation projects.Site:ARSSINFRAMain Symbol:ARSSINFRA
Stock trades at 28.8, below its 50dma 29.66. However it is trading above its 200dma 26.39. 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 29.66.
The 52 week high is at 37.50 and the 52week low is at 11.60
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -16.53% over past five years.
– has a low return on equity of -168.19% for last 3 years.
-Contingent liabilities of Rs.344.49 Cr.
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 34.6x. Macrotech Devel. trades at the industry’s max P/E of 650.37x. ARSSINFRA trades at a P/E of x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 7.0. ARSSINFRA has a G-Factor of 3 and Piotski scoreof 2.
– Average 1 month return for industry is 11.2%. The max 1- month return was given by National Standar: a return of 32.92 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 59.0 cr compared to Rs 41.0 cr for period ended Jun 2020, a rise of 43.9%
Company reported negative operating profit of Rs -22.0 cr for period ended Jun 2021. For same period last year, operating profit was 3.0
The EPS for Jun 2021 was Rs -8.98 compared to Rs 1.21 for previous quarter ended Mar 2021 and Rs 0.55 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 267.0 cr for period ended TTM vis-vis sales of Rs 248.0 cr for the period ended Mar 2021, a growth of 7.1%. The 3 year sales cagr stood at -16.5%.
Operating margins shrank to -36.0% for period ended TTM vis-vis -29.0% for period ended Mar 2021, contraction of 700.0 bps.
Net Profit reported at Rs -74.0 cr for period ended TTM vis-vis sales of Rs -52.0 cr for the period ended Mar 2021, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities: Rs 0.0 cr for period ended Mar 2021 vis-vis Rs -55.0 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -1453.0% compared to -168.0% over the last 3 Years. – The stock has given a return of 93% on a 1 Year basis vis-vis a return of 4% over the last 3 Years. – The compounded sales growth on a TTM bassis is -14% vis-vis a compounded sales growth of -25% over the last 3 Years. – The compounded profit growth on a TTM basis is -74% 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 53.3% vis-vis 53.3% for Mar 2021
Conclusion
– – has low interest coverage ratio.
-The company has delivered a poor sales growth of -16.53% over past five years.
– has a low return on equity of -168.19% for last 3 years.
-Contingent liabilities of Rs.344.49 Cr.
– might be capitalizing the interest cost
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 29.66 and is trading at 28.8. 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
