Mehabe score: 5 G Factor: 4 Piotski Score: 4 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 4 and Piotski score of 4.
Description
QGO Finance is engaged in the business of Financial Services.Site:538646Main Symbol:QGO
Stock trades at 31.0, above its 50dma 25.44. It also trades above its 200dma 20.28. The stock remains bullish on techicals
The 52 week high is at 33.50 and the 52week low is at 11.40
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.35%
– has a low return on equity of 6.59% for last 3 years.
Competition
– The industry trades at a mean P/E of 22.0x. SBI Cards trades at the industry’s max P/E of 102.1x. 538646 trades at a P/E of 32.2x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 6.0. 538646 has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 1.8%. The max 1- month return was given by Qgo Finance: a return of 12.73 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 1.77 cr compared to Rs 1.18 cr for period ended Sep 2020, a rise of 50.0%
Operating Profits reported at Rs 1.36 cr for period ended Sep 2021 vis-vis 0.88 for period ended Sep 2020 .
Operating Margins expanded 226.0 bps for period ended Sep 2021 vis-vis Sep 2020 .
The EPS for Sep 2021 was Rs 0.3 compared to Rs 0.27 for previous quarter ended Jun 2021 and Rs 0.22 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 6.33 cr for period ended TTM vis-vis sales of Rs 5.2 cr for the period ended Mar 2021, a healthy growth of 17.9%. The 3 year sales cagr stood at 62.0%.
Operating margins shrank to 78.04% for period ended TTM vis-vis 81.54% for period ended Mar 2021, contraction of 350.0 bps.
Net Profit reported at Rs 0.73 cr for period ended TTM vis-vis sales of Rs 0.64 cr for the period ended Mar 2021, rising 12.3%.
Company recorded a healthy Net Profit CAGR of 163.3% 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 8.0% compared to 7.0% over the last 3 Years. – The stock has given a return of 92% on a 1 Year basis vis-vis a return of 23% over the last 3 Years. – The compounded sales growth on a TTM bassis is 45% vis-vis a compounded sales growth of 135% over the last 3 Years. – The compounded profit growth on a TTM basis is 6% vis-vis a compounded profit growth of 173% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Sep 2021 public holding stood at 36.07% vis-vis 34.72% for Jun 2021
Conclusion
– – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.35%
– has a low return on equity of 6.59% 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 25.44 and is trading at 31.0 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
