Mehabe score: 2 G Factor: 3 Piotski Score: 5 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 5.
Description
Natraj Proteins Limited is an India-based company engaged in the manufacturing of vegetable oils and fats through solvent extraction process.Site:530119
Market Cap:
Rs 19.0 cr
Price:
50.6
Trading pe:
48.7x
Book-value:
96.3/share
Div yield:
0.00 %
Earning yield:
3.81%
Face-value:
10.0/share
52week high:
68.65
52week low:
14.00
Technical Analysis
Stock trades at 50.6, above its 50dma 48.02. It also trades above its 200dma 32.79. The stock remains bullish on techicals
The 52 week high is at 68.65 and the 52week low is at 14.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
-Stock is trading at 0.53 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 -6.16% over past five years.
– has a low return on equity of 1.77% for last 3 years.
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 36.6x. Ruchi Soya Inds. trades at the industry’s max P/E of 96.7x. 530119 trades at a P/E of 48.7x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 8.0. 530119 has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is -0.5%. The max 1- month return was given by BCL Industries: a return of 41.1 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 46.78 cr compared to Rs 37.08 cr for period ended Mar 2020, a rise of 26.2%
Operating Profits reported at Rs 2.38 cr for period ended Mar 2021 vis-vis 0.68 for period ended Mar 2020 .
Operating Margins expanded 325.4 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 3.52 compared to Rs 6.89 for previous quarter ended Dec 2020 and Rs -0.67 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 146.0 cr for period ended Mar 2021 vis-vis sales of Rs 154.0 cr for the period ended Mar 2020, a fall of 5.5%. The 3 year sales cagr stood at -9.4%.
Operating margins shrank to 2.0% for period ended Mar 2021 vis-vis 3.0% for period ended Mar 2020, contraction of 100.0 bps.
Net Profit reported at Rs 0.0 cr for period ended Mar 2021 vis-vis sales of Rs 0.0 cr for the period ended Mar 2020,
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 1.0% compared to 2.0% over the last 3 Years. – The stock has given a return of 143% on a 1 Year basis vis-vis a return of 10% over the last 3 Years. – The compounded sales growth on a TTM bassis is -5% vis-vis a compounded sales growth of -9% over the last 3 Years. – The compounded profit growth on a TTM basis is 15% vis-vis a compounded profit growth of -38% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 45.03% vis-vis 45.03% for Dec 2020
Conclusion
– has reduced debt.
-Stock is trading at 0.53 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 -6.16% over past five years.
– has a low return on equity of 1.77% for last 3 years.
– might be capitalizing the interest cost
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 48.02 and is trading at 50.6 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
