Mehabe score: 6 G Factor: 2 Piotski Score: 7 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 7.
Description
Sunshine Capital is engaged in the Business of Financial Services Dealing in shares and securities & interest & dividend income.Site:539574Main Symbol:SCL
Stock trades at 9.0, above its 50dma 8.38. However it is trading below its 200dma 11.07. The stock remains weak though short term bullish momentum supports price action. It needs to close above 11.07 for bullish price action to continue
The 52 week high is at 7.58 and the 52week low is at 5.50
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.11 times its book value
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
-Promoter holding is low: 5.50%
– has a low return on equity of 0.68% for last 3 years.
Competition
– The industry trades at a mean P/E of 21.9x. SBI Cards trades at the industry’s max P/E of 98.92x. 539574 trades at a P/E of 12.1x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 7.0. 539574 has a G-Factor of 2 and Piotski scoreof 7.
– Average 1 month return for industry is 2.5%. The max 1- month return was given by Sunshine Capital: a return of 13.21 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 1.1 cr compared to Rs 0.98 cr for period ended Sep 2020, a rise of 12.2%
Operating Profits reported at Rs 0.88 cr for period ended Sep 2021 vis-vis 0.74 for period ended Sep 2020 .
Operating Margins expanded 449.0 bps for period ended Sep 2021 vis-vis Sep 2020 .
The EPS for Sep 2021 was Rs 0.68 compared to Rs 0.66 for previous quarter ended Jun 2021 and Rs 0.57 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2.98 cr for period ended TTM vis-vis sales of Rs 2.8 cr for the period ended Mar 2021, a growth of 6.0%. The 3 year sales cagr stood at 39.0%.
Operating margins expanded to 52.68% for period ended TTM vis-vis 48.57% for period ended Mar 2021, expansion of 411.0 bps.
Net Profit reported at Rs 0.94 cr for period ended TTM vis-vis sales of Rs 0.89 cr for the period ended Mar 2021, rising 5.3%.
Company recorded a healthy Net Profit CAGR of 24.3% 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 0.11 cr for period ended Mar 2021 vis-vis Rs 0.01 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 1.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 58% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is -17% vis-vis a compounded sales growth of 137% over the last 3 Years. – The compounded profit growth on a TTM basis is -13% vis-vis a compounded profit growth of 353% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Sep 2021 public holding stood at 94.5% vis-vis 94.52% for Jun 2021
Conclusion
– is almost debt free.
-Stock is trading at 0.11 times its book value – Though the company is reporting repeated profits, it is not paying out dividend
-Promoter holding is low: 5.50%
– has a low return on equity of 0.68% 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 8.38 and is trading at 9.0 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
