Mehabe score: 5 G Factor: 5 Piotski Score: 6 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 5 and Piotski score of 6.
Description
Saurashtra Cement Limited is engaged in the business of manufacturing and selling of Cement. It markets cement under the brand name ‘HATHI’. The Co is part of the Mehta Group which also has another Cement and Building materials company called Gujarat Sidhee Cement Limited. [1] [2] Site:SAURASHCEM Main Symbol:SAURASHCEM
Stock trades at 81.3, above its 50dma 77.66. It also trades above its 200dma 79.01. The stock remains bullish on techicals
The 52 week high is at 138.90 and the 52week low is at 52.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 1.08 times its book value
– is expected to give good quarter
Weakness
– The company has delivered a poor sales growth of 4.93% over past five years.
– has a low return on equity of 10.01% for last 3 years.
-Dividend payout has been low at 12.81% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 14.7x. J K Cements trades at the industry’s max P/E of 36.74x. SAURASHCEM trades at a P/E of 13.8x
– Industry’s mean G-Factor is 2.9 while the mean Piotski score is 9.0. SAURASHCEM has a G-Factor of 5 and Piotski scoreof 6.
– Average 1 month return for industry is -1.3%. The max 1- month return was given by Saurashtra Cem.: a return of 12.45 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 192.25 cr compared to Rs 206.47 cr for period ended Dec 2020, a fall of 6.9%
.
vis-vis 34.1 for period ended Dec 2020 .
Operating Margins contracted -1052.9 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 11.51 cr for period ended Dec 2021 and operating profit margin at 6.0 % for same period.
The EPS for quarter ended Dec 2021 is Rs 0.59 compared to Rs -1.02 for previous quarter ended Sep 2021 and Rs 2.97 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 778.0 cr for period ended TTM vis-vis sales of Rs 674.0 cr for the period ended Mar 2021, a healthy growth of 13.4%. The 3 year sales cagr stood at 7.7%.
Operating margins shrank to 10.0% for period ended TTM vis-vis 17.0% for period ended Mar 2021, contraction of 700.0 bps.
Net Profit reported at Rs 41.0 cr for period ended TTM vis-vis sales of Rs 72.0 cr for the period ended Mar 2021, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 134.0 cr for period ended Mar 2021 vis-vis Rs 63.0 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 15.0% compared to 10.0% over the last 3 Years. – The stock has given a return of 34% on a 1 Year basis vis-vis a return of 28% over the last 3 Years. – The compounded sales growth on a TTM bassis is 28% vis-vis a compounded sales growth of 6% over the last 3 Years. – The compounded profit growth on a TTM basis is -27% vis-vis a compounded profit growth of 5% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Dec 2021 public holding stood at 27.06% vis-vis 26.87% for Sep 2021
Conclusion
– is almost debt free.
-Stock is trading at 1.08 times its book value
– is expected to give good quarter – The company has delivered a poor sales growth of 4.93% over past five years.
– has a low return on equity of 10.01% for last 3 years.
-Dividend payout has been low at 12.81% of profits over last 3 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 77.66 and is trading at 81.3, thus bullish price action wise.
