Mehabe score: 0 G Factor: 1 Piotski Score: 7 The stock has a rating SELL. 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 1 and Piotski score of 7.
Description
Phaarmasia Limited is manufactures and sells pharmaceutical products and bulk drugs in India.Site:523620
Market Cap:
Rs 21.8 cr
Price:
31.9
Trading pe:
32.0x
Book-value:
19.8/share
Div yield:
0.00 %
Earning yield:
4.46%
Face-value:
10.0/share
52week high:
42.70
52week low:
17.40
Technical Analysis
Stock trades at 31.9, below its 50dma 33.61. However it is trading above its 200dma 29.66. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 33.61.
The 52 week high is at 42.70 and the 52week low is at 17.40
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 5.00% for last 3 years.
-Earnings include an other income of Rs.0.92 Cr.
– has high debtors of 183.92 days.
Competition
– The industry trades at a mean P/E of 28.6x. Sun Pharma.Inds. trades at the industry’s max P/E of 54.93x. 523620 trades at a P/E of 32.0x
– Industry’s mean G-Factor is 2.0 while the mean Piotski score is 8.0. 523620 has a G-Factor of 1 and Piotski scoreof 7.
– Average 1 month return for industry is 2.4%. The max 1- month return was given by Piramal Enterp.: a return of 40.98 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 5.36 cr compared to Rs 5.49 cr for period ended Mar 2020, a fall of 2.4%
Operating Profits reported at Rs 0.23 cr for period ended Mar 2021 vis-vis 0.68 for period ended Mar 2020 .
Operating Margins contracted -809.5 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.22 compared to Rs 0.04 for previous quarter ended Dec 2020 and Rs 0.75 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 19.9 cr for period ended Mar 2021 vis-vis sales of Rs 24.45 cr for the period ended Mar 2020, a fall of 22.9%. The 3 year sales cagr stood at 1.6%.
Operating margins shrank to -0.3% for period ended Mar 2021 vis-vis 3.35% for period ended Mar 2020, contraction of 365.0 bps.
Net Profit reported at Rs 0.31 cr for period ended Mar 2021 vis-vis sales of Rs 0.54 cr for the period ended Mar 2020, falling 74.2%.
Company reported a poor Net Profit CAGR of -18.4% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 4.0% compared to 5.0% over the last 3 Years. – The stock has given a return of 60% on a 1 Year basis vis-vis a return of -4% over the last 3 Years. – The compounded sales growth on a TTM bassis is -37% vis-vis a compounded sales growth of 19% over the last 3 Years. – The compounded profit growth on a TTM basis is -42% vis-vis a compounded profit growth of 50% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 26.43% vis-vis 26.43% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free. – Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 5.00% for last 3 years.
-Earnings include an other income of Rs.0.92 Cr.
– has high debtors of 183.92 days.
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 33.61 and is trading at 31.9. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
