Mehabe score: 0 G Factor: 2 Piotski Score: 2 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 2 and Piotski score of 2.
Description
Business Overview
The company manufactures pesticides and formulations of fungicides, insecticides, and weedicides for the protection of crops, biological, and herbal products.
The company has valid CIB(Central Insecticides Board) registrations for 10 Technical Grade Pesticides, and more than 111 variations of weedicides, insecticides, fungicides, and bio products, for domestic sales and exports.
The management has an experience of more than 33 years.
Stock trades at 8.11, below its 50dma 8.48 and below its 200dma 8.67. The stock remains bearish on technicals
The 52 week high is at 13.69 and the 52week low is at 6.51
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 1.05 times its book value
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -9.41% over past five years.
-Promoter holding is low: 39.12%
– has a low return on equity of 1.48% for last 3 years.
– has high debtors of 259.55 days.
Competition
– The industry trades at a mean P/E of 33.4x. P I Industries trades at the industry’s max P/E of 64.51x. 530883 trades at a P/E of x
– Industry’s mean G-Factor is 3.1 while the mean Piotski score is 9.0. 530883 has a G-Factor of 2 and Piotski scoreof 2.
– Average 1 month return for industry is 1.0%. The max 1- month return was given by Sumitomo Chemi.: a return of 11.32 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 6.42 cr compared to Rs 9.18 cr for period ended Jun 2020, a fall of 30.1%
Company reported negative operating profit of Rs -0.71 cr for period ended Jun 2021. For same period last year, operating profit was -0.01
The EPS for Jun 2021 was Rs -0.25 compared to Rs -0.75 for previous quarter ended Mar 2021 and Rs -0.09 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 41.27 cr for period ended TTM vis-vis sales of Rs 44.03 cr for the period ended Mar 2021, a fall of 6.7%. The 3 year sales cagr stood at -13.8%.
Operating margins shrank to -9.72% for period ended TTM vis-vis -7.47% for period ended Mar 2021, contraction of 225.0 bps.
Net Profit reported at Rs -6.11 cr for period ended TTM vis-vis sales of Rs -5.5 cr for the period ended Mar 2021, 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -16.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 11% on a 1 Year basis vis-vis a return of -33% over the last 3 Years. – The compounded sales growth on a TTM bassis is -16% vis-vis a compounded sales growth of -14% over the last 3 Years. – The compounded profit growth on a TTM basis is -464% 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 60.88% vis-vis 60.88% for Mar 2021
Conclusion
– Stock is trading at 1.05 times its book value – has low interest coverage ratio.
-The company has delivered a poor sales growth of -9.41% over past five years.
-Promoter holding is low: 39.12%
– has a low return on equity of 1.48% for last 3 years.
– has high debtors of 259.55 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 8.48 and is trading at 8.11. 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
