Mehabe score: 3 G Factor: 2 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 2 and Piotski score of 6.
Description
Amal is engaged in manufacturing and marketing of bulk chemicals such as Sulphuric acid and Oleum and their downstream products such as Sulphur dioxide and Sulphur trioxide.(Source : 201903 Annual Report Page No: 1)Site:506597Main Symbol:AMAL
Stock trades at 433.0, above its 50dma 389.62. It also trades above its 200dma 299.34. The stock remains bullish on techicals
The 52 week high is at 466.30 and the 52week low is at 132.10
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 34.71%
-Debtor days have improved from 88.73 to 58.43 days.
Weakness
– Stock is trading at 11.87 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 5.59% over past five years.
Competition
– The industry trades at a mean P/E of 25.2x. Amal trades at the industry’s max P/E of 46.08x. 506597 trades at a P/E of 46.1x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 7.0. 506597 has a G-Factor of 2 and Piotski scoreof 6.
– Average 1 month return for industry is 10.6%. The max 1- month return was given by Vidhi Specialty: a return of 20.9 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 2.8 cr compared to Rs 4.92 cr for period ended Jun 2020, a fall of 43.1%
Company reported negative operating profit of Rs -1.91 cr for period ended Jun 2021. For same period last year, operating profit was 1.69
The EPS for Jun 2021 was Rs -1.78 compared to Rs 2.99 for previous quarter ended Mar 2021 and Rs 1.15 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 28.31 cr for period ended TTM vis-vis sales of Rs 30.42 cr for the period ended Mar 2021, a fall of 7.5%. The 3 year sales cagr stood at -4.9%.
Operating margins shrank to 27.2% for period ended TTM vis-vis 37.18% for period ended Mar 2021, contraction of 998.0 bps.
Net Profit reported at Rs 6.08 cr for period ended TTM vis-vis sales of Rs 8.85 cr for the period ended Mar 2021, falling 45.6%.
Company reported a poor Net Profit CAGR of -7.8% 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 28.0% compared to 35.0% over the last 3 Years. – The stock has given a return of 185% on a 1 Year basis vis-vis a return of 50% over the last 3 Years. – The compounded sales growth on a TTM bassis is -7% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is 1% vis-vis a compounded profit growth of -2% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 33.63% vis-vis 33.63% for Mar 2021
Conclusion
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 34.71%
-Debtor days have improved from 88.73 to 58.43 days. – Stock is trading at 11.87 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of 5.59% over past five years.
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 389.62 and is trading at 433.0 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
