Mehabe score: 4 G Factor: 3 Piotski Score: 6 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 6.
Description
Religare Enterprises Limited is a financial services company. The Company is engaged in the business of broking in securities and commodities, lending and investments, financial advisory services, custodial and depository operations, portfolio managementSite:RELIGAREMain Symbol:RELIGARE
Stock trades at 160.0, above its 50dma 158.51. It also trades above its 200dma 118.12. The stock remains bullish on techicals
The 52 week high is at 194.80 and the 52week low is at 45.10
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -12.48% over past five years.
– has a low return on equity of -148.68% for last 3 years.
-Earnings include an other income of Rs.38.57 Cr.
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. RELIGARE trades at a P/E of x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 6.0. RELIGARE has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 0.0%. The max 1- month return was given by Cholaman.Inv.&Fn: a return of 11.52 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 794.0 cr compared to Rs 628.0 cr for period ended Sep 2020, a rise of 26.4%
Company reported negative operating profit of Rs -264.0 cr for period ended Sep 2021. For same period last year, operating profit was 71.0
The EPS for Sep 2021 was Rs -13.49 compared to Rs -9.74 for previous quarter ended Jun 2021 and Rs -4.54 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2798.0 cr for period ended TTM vis-vis sales of Rs 2513.0 cr for the period ended Mar 2021, a healthy growth of 10.2%. The 3 year sales cagr stood at 5.7%.
Operating margins shrank to -9.0% for period ended TTM vis-vis 11.0% for period ended Mar 2021, contraction of 2000.0 bps.
Net Profit reported at Rs -885.0 cr for period ended TTM vis-vis sales of Rs -508.0 cr for the period ended Mar 2021, falling 0%.
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 -1886.0% compared to -149.0% over the last 3 Years. – The stock has given a return of 215% on a 1 Year basis vis-vis a return of 66% over the last 3 Years. – The compounded sales growth on a TTM bassis is 13% vis-vis a compounded sales growth of -2% over the last 3 Years. – The compounded profit growth on a TTM basis is 34% vis-vis a compounded profit growth of 15% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 18.75% vis-vis 17.29% for Jun 2021 – Public shareholding has risen for the period ended Sep 2021. The Sep 2021 public holding stood at 79.83% vis-vis 77.47% for Jun 2021
Conclusion
– – has low interest coverage ratio.
-The company has delivered a poor sales growth of -12.48% over past five years.
– has a low return on equity of -148.68% for last 3 years.
-Earnings include an other income of Rs.38.57 Cr.
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 158.51 and is trading at 160.0 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
