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
Welcure Drugs & Pharmaceuticals Ltd is engaged in the business of manufacture and marketing of pharmaceuticals formulations in the form of tablets, capsules and dry syrups. The Company is manufacturing over hundred varieties of formulations including antibiotics, vitamins, analgesics, antipyretics, corticosteroids, anti-malarials, anti-dysentery, anti-tuberculosis, anti-diabetics, tranquillizers, sedatives and gastro intestinals. [1] Site:WELCURE Main Symbol:WELCURE
Stock trades at 9.81, above its 50dma 8.87. It also trades above its 200dma 6.56. The stock remains bullish on techicals
The 52 week high is at 12.08 and the 52week low is at 1.87
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 52.63%
Weakness
– Stock is trading at 441.85 times its book value
-Promoter holding is low: 14.12%
Competition
– The industry trades at a mean P/E of 26.8x. Welcure Drugs trades at the industry’s max P/E of 1325.0x. WELCURE trades at a P/E of 1325.0x
– Industry’s mean G-Factor is 2.0 while the mean Piotski score is 9.0. WELCURE has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 1.8%. The max 1- month return was given by Welcure Drugs: a return of 20.07 %
Quarterly Results
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Company reported negative operating profit of Rs -0.01 cr for period ended Dec 2021. For same period last year, operating profit was 0.0.
The EPS for quarter ended Dec 2021 is Rs -0.01 compared to Rs -0.01 for previous quarter ended Sep 2021 and Rs 0.0 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 0.07 cr for period ended TTM vis-vis sales of Rs 0.13 cr for the period ended Mar 2021, a fall of 85.7%. The 3 year sales cagr stood at -4.4%.
Net Profit reported at Rs 0 cr for period ended TTM vis-vis sales of Rs 0.06 cr for the period ended Mar 2021, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 0.04 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 improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 133.0% compared to 53.0% over the last 3 Years. – The stock has given a return of 342% on a 1 Year basis vis-vis a return of 163% over the last 3 Years. – The compounded sales growth on a TTM bassis is 63% vis-vis a compounded sales growth of 38% over the last 3 Years. – The compounded profit growth on a TTM basis is % vis-vis a compounded profit growth of 71% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Dec 2021 public holding stood at 85.86% vis-vis 85.86% for Sep 2021
Conclusion
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 52.63% – Stock is trading at 441.85 times its book value
-Promoter holding is low: 14.12%
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 8.87 and is trading at 9.81 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
