Mehabe score: 3 G Factor: 6 Piotski Score: 5 The stock has a rating 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 6 and Piotski score of 5.
Description
NR Agarwal Industries Ltd is in the business of manufacturing different kinds of duplex paper boards and writing and printing papers.
The company is among the first and leading manufacturers of recycled paper in India and the largest manufacturer of grey back and white back duplex board for over 2 decades. [1] Site:NRAGRINDQ Main Symbol:NRAGRINDQ
Stock trades at 263.0, above its 50dma 261.04. However it is trading below its 200dma 263.85. The stock remains weak though short term bullish momentum supports price action. It needs to close above 263.85 for bullish price action to continue
The 52 week high is at 361.15 and the 52week low is at 193.85
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.88 times its book value
– is expected to give good quarter
– has a good return on equity (ROE) track record: 3 Years ROE 25.00%
Weakness
– The company has delivered a poor sales growth of 5.34% over past five years.
Competition
– The industry trades at a mean P/E of 15.5x. Century Textiles trades at the industry’s max P/E of 135.16x. NRAGRINDQ trades at a P/E of 7.77x
– Industry’s mean G-Factor is 5.2 while the mean Piotski score is 5.0. NRAGRINDQ has a G-Factor of 6 and Piotski scoreof 5.
– Average 1 month return for industry is 5.5%. The max 1- month return was given by Emami Paper: a return of 19.85 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 395.31 cr compared to Rs 328.03 cr for period ended Dec 2020, a rise of 20.5% .
vis-vis 35.07 for period ended Dec 2020 .
Operating Margins contracted -372.4 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 27.54 cr for period ended Dec 2021 and operating profit margin at 7.0 % for same period.
The EPS for quarter ended Dec 2021 is Rs 5.61 compared to Rs 3.79 for previous quarter ended Sep 2021 and Rs 9.11 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1513.0 cr for period ended TTM vis-vis sales of Rs 1146.0 cr for the period ended Mar 2021, a healthy growth of 24.3%. The 3 year sales cagr stood at 4.7%.
Operating margins shrank to 8.0% for period ended TTM vis-vis 12.0% for period ended Mar 2021, contraction of 400.0 bps.
Net Profit reported at Rs 51.0 cr for period ended TTM vis-vis sales of Rs 57.0 cr for the period ended Mar 2021, falling 11.8%.
Company reported a poor Net Profit CAGR of -18.7% 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 13.0% compared to 25.0% over the last 3 Years. – The stock has given a return of 22% on a 1 Year basis vis-vis a return of -6% over the last 3 Years. – The compounded sales growth on a TTM bassis is 23% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is -43% vis-vis a compounded profit growth of -14% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Dec 2021 fii holding stood at 0.73% vis-vis 0.63% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 25.71% vis-vis 25.81% for Sep 2021
Conclusion
– Stock is trading at 0.88 times its book value
– is expected to give good quarter
– has a good return on equity (ROE) track record: 3 Years ROE 25.00% – The company has delivered a poor sales growth of 5.34% over past five years.
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 261.04 and is trading at 263.0, thus bullish price action wise.
