Mehabe score: 3 G Factor: 4 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 4 and Piotski score of 6.
Description
Everest Organics Ltd is a pharmaceutical company that is engaged in the business of manufacturing of Active Pharmaceutical Ingredients (APIs) & Intermediates since past 2 decades.#
Main Points
Product Portfolio
The company’s portfolio includes various Active Pharma Ingredients and Intermediates.#
The company’s product portfolio is highly concentrated in the anti-ulcerative therapeutic segment with top 3 products; Omeprazole, Esomeprazole & Pantoprazole contributing ~60% of total revenues in the past 4 years.
The company entered into anti-viral, anti-coagulant and anti-gout segments from new products launched in FY20.Site:524790Main Symbol:EVERESTO
Stock trades at 336.0, below its 50dma 340.3. However it is trading above its 200dma 293.38. 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 340.3.
The 52 week high is at 469.95 and the 52week low is at 199.70
Price Chart
P/E Chart
Sales and Margin
Strengths
– has delivered good profit growth of 75.25% CAGR over last 5 years
– has a good return on equity (ROE) track record: 3 Years ROE 34.62%
Weakness
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Competition
– The industry trades at a mean P/E of 22.9x. Sequent Scien. trades at the industry’s max P/E of 69.52x. 524790 trades at a P/E of 19.6x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 8.0. 524790 has a G-Factor of 4 and Piotski scoreof 6.
– Average 1 month return for industry is 5.9%. The max 1- month return was given by Gland Pharma: a return of 19.12 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 51.33 cr compared to Rs 43.19 cr for period ended Jun 2020, a rise of 18.8%
Operating Profits reported at Rs 4.21 cr for period ended Jun 2021 vis-vis 5.97 for period ended Jun 2020 .
Operating Margins contracted -562.1 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 2.66 compared to Rs 2.75 for previous quarter ended Mar 2021 and Rs 4.48 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 190.0 cr for period ended TTM vis-vis sales of Rs 182.0 cr for the period ended Mar 2021, a growth of 4.2%. The 3 year sales cagr stood at 6.8%.
Operating margins shrank to 11.0% for period ended TTM vis-vis 13.0% for period ended Mar 2021, contraction of 200.0 bps.
Net Profit reported at Rs 12.0 cr for period ended TTM vis-vis sales of Rs 14.0 cr for the period ended Mar 2021, falling 16.7%.
Company recorded a healthy Net Profit CAGR of 14.5% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 14.0 cr for period ended Mar 2021 vis-vis Rs 10.0 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 34.0% compared to 35.0% over the last 3 Years. – The stock has given a return of 40% on a 1 Year basis vis-vis a return of 55% over the last 3 Years. – The compounded sales growth on a TTM bassis is 9% vis-vis a compounded sales growth of 17% over the last 3 Years. – The compounded profit growth on a TTM basis is 26% vis-vis a compounded profit growth of 100% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 25.82% vis-vis 25.82% for Mar 2021
Conclusion
– has delivered good profit growth of 75.25% CAGR over last 5 years
– has a good return on equity (ROE) track record: 3 Years ROE 34.62% –
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 below its 50 DMA 340.3 and is trading at 336.0. Shows a near term lack of buying interest.
