Mehabe score: 6 G Factor: 1 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 1 and Piotski score of 6.
Description
GNA Axles is engaged in the Business of manufactures auto components for the four-wheeler industry, primary product being Rear Axles, Shafts, Spindles & other Automobiles Components for sale in domestic and foreign market. Site:GNA Main Symbol:GNA
Stock trades at 757.0, above its 50dma 740.59. It also trades above its 200dma 647.61. The stock remains bullish on techicals
The 52 week high is at 1111.55 and the 52week low is at 317.05
Price Chart
P/E Chart
Sales and Margin
Strengths
– is expected to give good quarter
Weakness
– The company has delivered a poor sales growth of 11.83% over past five years.
– might be capitalizing the interest cost
-Dividend payout has been low at 8.05% of profits over last 3 years
– has high debtors of 179.68 days.
Competition
– The industry trades at a mean P/E of 23.5x. WABCO India trades at the industry’s max P/E of 104.12x. GNA trades at a P/E of 15.0x
– Industry’s mean G-Factor is 2.0 while the mean Piotski score is 7.0. GNA has a G-Factor of 1 and Piotski scoreof 6.
– Average 1 month return for industry is 4.8%. The max 1- month return was given by Minda Industries: a return of 27.46 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 301.0 cr compared to Rs 276.0 cr for period ended Dec 2020, a rise of 9.1% .
vis-vis 48.0 for period ended Dec 2020 .
Operating Margins contracted -476.7 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 38.0 cr for period ended Dec 2021 and operating profit margin at 12.6 % for same period.
The EPS for quarter ended Dec 2021 is Rs 7.77 compared to Rs 11.42 for previous quarter ended Sep 2021 and Rs 12.41 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1280.0 cr for period ended TTM vis-vis sales of Rs 890.0 cr for the period ended Mar 2021, a healthy growth of 30.5%. The 3 year sales cagr stood at 11.3%.
Operating margins shrank to 15.0% for period ended TTM vis-vis 16.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 98.0 cr for period ended TTM vis-vis sales of Rs 71.0 cr for the period ended Mar 2021, rising 27.6%.
Company recorded a healthy Net Profit CAGR of 14.1% 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 15.0% compared to 15.0% over the last 3 Years. – The stock has given a return of 134% on a 1 Year basis vis-vis a return of 27% over the last 3 Years. – The compounded sales growth on a TTM bassis is 80% vis-vis a compounded sales growth of 10% over the last 3 Years. – The compounded profit growth on a TTM basis is 278% vis-vis a compounded profit growth of 12% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 1.54% vis-vis 2.03% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 21.91% vis-vis 20.32% for Jun 2021
Conclusion
– is expected to give good quarter – The company has delivered a poor sales growth of 11.83% over past five years.
– might be capitalizing the interest cost
-Dividend payout has been low at 8.05% of profits over last 3 years
– has high debtors of 179.68 days.
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 740.59 and is trading at 757.0 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
