Mehabe score: 4 G Factor: 2 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 2 and Piotski score of 5.
Description
Phoenix Mills Ltd is engaged in the operation & management of malls, construction of commercial & residential property and hotel business in India. It is India’s largest mall owner, with presence across major metros including Mumbai, Bengaluru, Chennai, Pune and Lucknow. It has an operational history of more than 100 years. The Co. operates 8 Malls spread over ~6 mn sq ft in 6 Major CitiesSite:PHOENIXLTDMain Symbol:PHOENIXLTD
Stock trades at 961.0, above its 50dma 878.08. It also trades above its 200dma 803.29. The stock remains bullish on techicals
The 52 week high is at 1031.05 and the 52week low is at 548.05
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 3.39 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -9.60% over past five years.
-Tax rate seems low
– has a low return on equity of 6.86% for last 3 years.
-Dividend payout has been low at 14.53% of profits over last 3 years
-Debtor days have increased from 58.32 to 100.83 days.
-Promoter holding has decreased over last 3 years: -17.32%
Competition
– The industry trades at a mean P/E of 30.6x. Phoenix Mills trades at the industry’s max P/E of 240.33x. PHOENIXLTD trades at a P/E of 240.0x
– Industry’s mean G-Factor is 3.3 while the mean Piotski score is 8.0. PHOENIXLTD has a G-Factor of 2 and Piotski scoreof 5.
– Average 1 month return for industry is 2.5%. The max 1- month return was given by Brigade Enterpr.: a return of 16.54 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 371.0 cr compared to Rs 215.0 cr for period ended Sep 2020, a rise of 72.6%
Operating Profits reported at Rs 186.0 cr for period ended Sep 2021 vis-vis 92.0 for period ended Sep 2020 .
Operating Margins expanded 734.4 bps for period ended Sep 2021 vis-vis Sep 2020 .
The EPS for Sep 2021 was Rs 3.46 compared to Rs -1.52 for previous quarter ended Jun 2021 and Rs -2.09 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1299.0 cr for period ended TTM vis-vis sales of Rs 1068.0 cr for the period ended Mar 2021, a healthy growth of 17.8%. The 3 year sales cagr stood at -13.1%.
Operating margins shrank to 46.0% for period ended TTM vis-vis 47.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 164.0 cr for period ended TTM vis-vis sales of Rs 53.0 cr for the period ended Mar 2021, rising 67.7%.
Company reported a poor Net Profit CAGR of -27.0% 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 1.0% compared to 7.0% over the last 3 Years. – The stock has given a return of 67% on a 1 Year basis vis-vis a return of 19% over the last 3 Years. – The compounded sales growth on a TTM bassis is -22% vis-vis a compounded sales growth of -13% over the last 3 Years. – The compounded profit growth on a TTM basis is -56% vis-vis a compounded profit growth of -39% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has fallen for the period ended Sep 2021. The Sep 2021 fii holding stood at 32.29% vis-vis 34.43% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 4.19% vis-vis 3.85% for Jun 2021
Conclusion
– – Stock is trading at 3.39 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -9.60% over past five years.
-Tax rate seems low
– has a low return on equity of 6.86% for last 3 years.
-Dividend payout has been low at 14.53% of profits over last 3 years
-Debtor days have increased from 58.32 to 100.83 days.
-Promoter holding has decreased over last 3 years: -17.32%
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 878.08 and is trading at 961.0 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
