Mehabe score: 5 G Factor: 2 Piotski Score: 3 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 2 and Piotski score of 3.
Description
John Cockerill India Ltd, incorporated in 1986, has been engaged in the designing, manufacturing, and commissioning of cold rolling mill complexes, processing lines, chemical equipment, industrial furnaces and auxiliary equipment for ferrous and non-ferrous industries worldwide. The Co. is part of the John Cockerill Group (previously known as the CMI group) headquartered in Belgium. It has two manufacturing facilities at Taloja and Hedavali, both in Maharashtra and has a global footprint across Asia, Africa, Middle East, Europe, North America and South America. The Co. was previously known as CMI FPE Limited and the name was changed to John Cockerill India Limited on June 16, 2020
Main Points
Products and Services
Equipment and services for the treatment of steels and non-ferrous metals relating to reheating furnaces, pickling, acid regeneration, cold rolling, strip processing and automation
Thermal treatment furnaces for the moulding and forging industries
Electrolytic and chemical surface treatment for various types of industry.Site:500147Main Symbol:COCKERILL
Stock trades at 1033.0, above its 50dma 889.2. It also trades above its 200dma 825.01. The stock remains bullish on techicals
The 52 week high is at 1115.00 and the 52week low is at 500.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
Weakness
– Stock is trading at 2.91 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -0.72% over past five years.
– has a low return on equity of 5.40% for last 3 years.
-Contingent liabilities of Rs.198.34 Cr.
– has high debtors of 235.24 days.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 24.6x. GMM Pfaudler trades at the industry’s max P/E of 95.6x. 500147 trades at a P/E of x
– Industry’s mean G-Factor is 3.2 while the mean Piotski score is 8.0. 500147 has a G-Factor of 2 and Piotski scoreof 3.
– Average 1 month return for industry is 4.2%. The max 1- month return was given by John Cockerill: a return of 13.67 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 97.3 cr compared to Rs 13.77 cr for period ended Jun 2020, a rise of 606.6%
Company reported negative operating profit of Rs -0.79 cr for period ended Jun 2021. For same period last year, operating profit was -11.15
The EPS for Jun 2021 was Rs -2.13 compared to Rs -18.15 for previous quarter ended Mar 2021 and Rs -20.45 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 282.0 cr for period ended TTM vis-vis sales of Rs 198.0 cr for the period ended Mar 2021, a healthy growth of 29.8%. The 3 year sales cagr stood at -17.2%.
Operating margins expanded to -6.0% for period ended TTM vis-vis -14.0% for period ended Mar 2021, expansion of 800.0 bps.
Net Profit reported at Rs -20.0 cr for period ended TTM vis-vis sales of Rs -29.0 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities: Rs -21.0 cr for period ended Mar 2021 vis-vis Rs -58.0 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -15.0% compared to 5.0% over the last 3 Years. – The stock has given a return of 98% on a 1 Year basis vis-vis a return of 11% over the last 3 Years. – The compounded sales growth on a TTM bassis is -47% vis-vis a compounded sales growth of -13% over the last 3 Years. – The compounded profit growth on a TTM basis is -219% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.0% vis-vis 0.0% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 23.11% vis-vis 23.16% for Mar 2021
Conclusion
– has reduced debt.
– is almost debt free. – Stock is trading at 2.91 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -0.72% over past five years.
– has a low return on equity of 5.40% for last 3 years.
-Contingent liabilities of Rs.198.34 Cr.
– has high debtors of 235.24 days.
-‘s cost of borrowing seems high
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 889.2 and is trading at 1033.0 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
