Mehabe score: 4 G Factor: 3 Piotski Score: 5 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 3 and Piotski score of 5.
Description
‘Shilchar Technologies is engaged in engaged in the business of manufacturing of Distribution & Power Transformers as well Electronics & Telecommunication
Transformers.’Site:531201Main Symbol:SHILCTECH
Stock trades at 202.0, below its 50dma 206.32. However it is trading above its 200dma 197.04. 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 206.32.
The 52 week high is at 262.75 and the 52week low is at 96.05
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
-Stock is trading at 1.16 times its book value
– is expected to give good quarter
Weakness
– The company has delivered a poor sales growth of -7.61% over past five years.
– has a low return on equity of 8.85% for last 3 years.
-Contingent liabilities of Rs.23.44 Cr.
– has high debtors of 167.09 days.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 29.3x. A B B trades at the industry’s max P/E of 157.48x. 531201 trades at a P/E of 13.0x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 7.0. 531201 has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is -0.3%. The max 1- month return was given by Crompton Gr. Con: a return of 7.06 %
Quarterly Results
Sales for period ended Dec 2020 is Rs 34.01 cr compared to Rs 18.77 cr for period ended Dec 2019, a rise of 81.2%
Operating Profits reported at Rs 4.19 cr for period ended Dec 2020 vis-vis 0.01 for period ended Dec 2019 .
Operating Margins expanded 1226.7 bps for period ended Dec 2020 vis-vis Dec 2019 .
The EPS for Dec 2020 was Rs 6.63 compared to Rs 5.64 for previous quarter ended Sep 2020 and Rs 0.42 for Dec 2019
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 102.0 cr for period ended TTM vis-vis sales of Rs 71.0 cr for the period ended Mar 2020, a healthy growth of 30.4%. The 3 year sales cagr stood at 5.0%.
Operating margins expanded to 10.0% for period ended TTM vis-vis 4.0% for period ended Mar 2020, expansion of 600.0 bps.
Net Profit reported at Rs 6.0 cr for period ended TTM vis-vis sales of Rs 2.0 cr for the period ended Mar 2020, rising 66.7%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 6.0 cr for period ended Mar 2020 vis-vis Rs 1.0 cr for period ended Mar 2019
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 2.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 92% on a 1 Year basis vis-vis a return of -17% over the last 3 Years. – The compounded sales growth on a TTM bassis is 22% vis-vis a compounded sales growth of -13% over the last 3 Years. – The compounded profit growth on a TTM basis is 186% vis-vis a compounded profit growth of -51% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 1.28% vis-vis 1.1% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 31.81% vis-vis 32.0% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free.
-Stock is trading at 1.16 times its book value
– is expected to give good quarter – The company has delivered a poor sales growth of -7.61% over past five years.
– has a low return on equity of 8.85% for last 3 years.
-Contingent liabilities of Rs.23.44 Cr.
– has high debtors of 167.09 days.
-‘s cost of borrowing seems high
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 206.32 and is trading at 202.0. 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
