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
Coastal Roadways is engaged in the Business of road transportation of goods.Site:520131Main Symbol:COARO
Stock trades at 19.0, above its 50dma 18.62. However it is trading below its 200dma 21.49. The stock remains weak though short term bullish momentum supports price action. It needs to close above 21.49 for bullish price action to continue
The 52 week high is at 27.90 and the 52week low is at 12.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
-Stock is trading at 0.65 times its book value
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -10.98% over past five years.
– has a low return on equity of -6.90% for last 3 years.
-Earnings include an other income of Rs.1.62 Cr.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 31.9x. Snowman Logistic trades at the industry’s max P/E of 14188.5x. 520131 trades at a P/E of x
– Industry’s mean G-Factor is 3.9 while the mean Piotski score is 7.0. 520131 has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 1.9%. The max 1- month return was given by Coastal Roadways: a return of 17.65 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 9.71 cr compared to Rs 8.84 cr for period ended Mar 2020, a rise of 9.8%
Operating Profits reported at Rs 0.47 cr for period ended Mar 2021 vis-vis 0.6 for period ended Mar 2020 .
Operating Margins contracted -194.7 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.22 compared to Rs 0.43 for previous quarter ended Dec 2020 and Rs 2.07 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 32.49 cr for period ended Mar 2021 vis-vis sales of Rs 42.22 cr for the period ended Mar 2020, a fall of 29.9%. The 3 year sales cagr stood at -15.9%.
Operating margins expanded to 4.31% for period ended Mar 2021 vis-vis 4.05% for period ended Mar 2020, expansion of 26.0 bps.
Net Profit reported at Rs 0.55 cr for period ended Mar 2021 vis-vis sales of Rs 0.4 cr for the period ended Mar 2020, rising 27.3%.
Company recorded a healthy Net Profit CAGR of 33.7% 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 stock has given a return of -21% on a 1 Year basis vis-vis a return of 1% over the last 3 Years. – The compounded sales growth on a TTM bassis is -23% vis-vis a compounded sales growth of -16% over the last 3 Years. – The compounded profit growth on a TTM basis is 0% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 25.0% vis-vis 25.0% for Mar 2021
Conclusion
– has reduced debt.
– is almost debt free.
-Stock is trading at 0.65 times its book value – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -10.98% over past five years.
– has a low return on equity of -6.90% for last 3 years.
-Earnings include an other income of Rs.1.62 Cr.
-‘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 18.62 and is trading at 19.0 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
