Mehabe score: 3 G Factor: 4 Piotski Score: 4 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 4 and Piotski score of 4.
Description
Mega Corporation operates as a non-banking finance company (NBFC), which is engaged in the finance and investments business. The Company operates through two segments: Aircraft Charter Services and Finance & Investments. The Company is also engaged in providing air charter services. The Company owns a small passenger aircraft.Site:531417
Market Cap:
Rs 15.0 cr
Price:
1.5
Trading pe:
x
Book-value:
2.42/share
Div yield:
0.00 %
Earning yield:
6.93%
Face-value:
1.00/share
52week high:
1.57
52week low:
0.31
Technical Analysis
Stock trades at 1.5, above its 50dma 1.03. It also trades above its 200dma 0.8. The stock remains bullish on techicals
The 52 week high is at 1.57 and the 52week low is at 0.31
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.62 times its book value
Weakness
– has low interest coverage ratio.
– has a low return on equity of -5.58% for last 3 years.
Competition
– The industry trades at a mean P/E of 24.2x. SBI Cards trades at the industry’s max P/E of 93.76x. 531417 trades at a P/E of x
– Industry’s mean G-Factor is 4.6 while the mean Piotski score is 7.0. 531417 has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 10.2%. The max 1- month return was given by Mega Corp.: a return of 92.31 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 0.61 cr compared to Rs 0.81 cr for period ended Mar 2020, a fall of 24.7%
Operating Profits reported at Rs 0.4 cr for period ended Mar 2021 vis-vis 0.51 for period ended Mar 2020 .
Operating Margins expanded 261.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs -0.06 compared to Rs -0.0 for previous quarter ended Dec 2020 and Rs -0.02 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2.75 cr for period ended Mar 2021 vis-vis sales of Rs 2.74 cr for the period ended Mar 2020, a growth of 0.4%. The 3 year sales cagr stood at 6.9%.
Operating margins shrank to 70.18% for period ended Mar 2021 vis-vis 74.45% for period ended Mar 2020, contraction of 427.0 bps.
Net Profit reported at Rs -0.26 cr for period ended Mar 2021 vis-vis sales of Rs 0.09 cr for the period ended Mar 2020, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities: Rs 0.0 cr for period ended Mar 2021 vis-vis Rs -10.85 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 improved its Return on Equity (RoE) metric. The RoE on Last Year basis was -1.0% compared to -6.0% over the last 3 Years. – The stock has given a return of 341% on a 1 Year basis vis-vis a return of -2% over the last 3 Years. – The compounded sales growth on a TTM bassis is 0% vis-vis a compounded sales growth of 7% over the last 3 Years. – The compounded profit growth on a TTM basis is 93% 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 45.69% vis-vis 45.69% for Dec 2020
Conclusion
– Stock is trading at 0.62 times its book value – has low interest coverage ratio.
– has a low return on equity of -5.58% for last 3 years.
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 1.03 and is trading at 1.5 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
