Mehabe score: 2 G Factor: 3 Piotski Score: 7 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 7.
Description
Daikaffil Chemicals India is engaged in manufacturing of organic chemicals and intermediaries and trading of chemicals.Site:530825
Market Cap:
Rs 21.5 cr
Price:
35.9
Trading pe:
32.6x
Book-value:
43.0/share
Div yield:
1.95 %
Earning yield:
5.05%
Face-value:
10.0/share
52week high:
44.85
52week low:
20.85
Technical Analysis
Stock trades at 35.9, above its 50dma 32.52. It also trades above its 200dma 30.37. The stock remains bullish on techicals
The 52 week high is at 44.85 and the 52week low is at 20.85
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.83 times its book value
-Debtor days have improved from 59.84 to 45.04 days.
Weakness
– The company has delivered a poor sales growth of -14.47% over past five years.
-Promoter holding is low: 31.41%
– has a low return on equity of 5.68% for last 3 years.
-Earnings include an other income of Rs.0.72 Cr.
Competition
– The industry trades at a mean P/E of 24.8x. Atul trades at the industry’s max P/E of 40.06x. 530825 trades at a P/E of 32.6x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 7.0. 530825 has a G-Factor of 3 and Piotski scoreof 7.
– Average 1 month return for industry is 9.7%. The max 1- month return was given by Kiri Industries: a return of 29.25 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1.68 cr compared to Rs 3.6 cr for period ended Mar 2020, a fall of 53.3%
Company reported negative operating profit of Rs -0.31 cr for period ended Mar 2021. For same period last year, operating profit was 0.59
The EPS for Mar 2021 was Rs -0.6 compared to Rs 0.08 for previous quarter ended Dec 2020 and Rs 0.9 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 11.4 cr for period ended Mar 2021 vis-vis sales of Rs 15.72 cr for the period ended Mar 2020, a fall of 37.9%. The 3 year sales cagr stood at -20.7%.
Operating margins shrank to 1.49% for period ended Mar 2021 vis-vis 11.7% for period ended Mar 2020, contraction of 1021.0 bps.
Net Profit reported at Rs -0.41 cr for period ended Mar 2021 vis-vis sales of Rs 1.08 cr for the period ended Mar 2020, falling 0%.
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 6.0% over the last 3 Years. – The stock has given a return of 65% on a 1 Year basis vis-vis a return of -20% over the last 3 Years. – The compounded sales growth on a TTM bassis is -20% vis-vis a compounded sales growth of -16% over the last 3 Years. – The compounded profit growth on a TTM basis is -29% vis-vis a compounded profit growth of -24% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 68.46% vis-vis 68.46% for Dec 2020
Conclusion
– is almost debt free.
-Stock is trading at 0.83 times its book value
-Debtor days have improved from 59.84 to 45.04 days. – The company has delivered a poor sales growth of -14.47% over past five years.
-Promoter holding is low: 31.41%
– has a low return on equity of 5.68% for last 3 years.
-Earnings include an other income of Rs.0.72 Cr.
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 32.52 and is trading at 35.9 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
