Mehabe score: 6 G Factor: 3 Piotski Score: 5 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 5.
Description
Siyaram Silk Mills is engaged in the business of Fabrics, Readymade Garments.Site:SIYSILMain Symbol:SIYSIL
Stock trades at 492.0, above its 50dma 369.83. It also trades above its 200dma 293.49. The stock remains bullish on techicals
The 52 week high is at 456.05 and the 52week low is at 132.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is expected to give good quarter
– has been maintaining a healthy dividend payout of 226.99%
Weakness
– Stock is trading at 3.01 times its book value
-The company has delivered a poor sales growth of -7.46% over past five years.
– has a low return on equity of 7.75% for last 3 years.
Competition
– The industry trades at a mean P/E of 12.9x. Alok Industries trades at the industry’s max P/E of 27.53x. SIYSIL trades at a P/E of 27.5x
– Industry’s mean G-Factor is 2.6 while the mean Piotski score is 6.0. SIYSIL has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 3.4%. The max 1- month return was given by Siyaram Silk: a return of 33.79 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 233.0 cr compared to Rs 41.0 cr for period ended Jun 2020, a rise of 468.3%
Company reported operating profit of Rs 29.0 cr for period ended Jun 2021, operating profit margin at 12.4 %.
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 2.67 compared to Rs 12.34 for previous quarter ended Mar 2021 and Rs -14.45 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1298.0 cr for period ended TTM vis-vis sales of Rs 1089.0 cr for the period ended Mar 2021, a healthy growth of 16.1%. The 3 year sales cagr stood at -10.6%.
Operating margins expanded to 12.0% for period ended TTM vis-vis 5.0% for period ended Mar 2021, expansion of 700.0 bps.
Net Profit reported at Rs 84.0 cr for period ended TTM vis-vis sales of Rs 4.0 cr for the period ended Mar 2021, rising 95.2%.
Company reported a poor Net Profit CAGR of -5.3% 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 330.0 cr for period ended Mar 2021 vis-vis Rs 201.0 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 1.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 245% on a 1 Year basis vis-vis a return of 14% over the last 3 Years. – The compounded sales growth on a TTM bassis is -8% vis-vis a compounded sales growth of -14% over the last 3 Years. – The compounded profit growth on a TTM basis is 319% vis-vis a compounded profit growth of -67% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 1.92% vis-vis 1.71% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 20.12% vis-vis 19.88% for Jun 2021
Conclusion
– has reduced debt.
– is expected to give good quarter
– has been maintaining a healthy dividend payout of 226.99% – Stock is trading at 3.01 times its book value
-The company has delivered a poor sales growth of -7.46% over past five years.
– has a low return on equity of 7.75% 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 369.83 and is trading at 492.0 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
