Mehabe score: 4 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
Lehar Footwears is engaged in the Business of manufacturing and selling of a reputed brand “LEHAR” footwears in domestic and Overseas market.Site:532829
Market Cap:
Rs 43.6 cr
Price:
31.8
Trading pe:
290.0x
Book-value:
42.3/share
Div yield:
0.00 %
Earning yield:
5.56%
Face-value:
10.0/share
52week high:
32.45
52week low:
15.75
Technical Analysis
Stock trades at 31.8, above its 50dma 27.11. It also trades above its 200dma 23.78. The stock remains bullish on techicals
The 52 week high is at 32.45 and the 52week low is at 15.75
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.75 times its book value
– is expected to give good quarter
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 2.52% over past five years.
– has a low return on equity of 2.73% for last 3 years.
Competition
– The industry trades at a mean P/E of 43.0x. Mirza Internatio trades at the industry’s max P/E of 123.8x. 532829 trades at a P/E of 290.0x
– Industry’s mean G-Factor is 3.2 while the mean Piotski score is 8.0. 532829 has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 21.8%. The max 1- month return was given by Khadim India: a return of 79.84 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 50.63 cr compared to Rs 21.98 cr for period ended Mar 2020, a rise of 130.3%
Operating Profits reported at Rs 3.07 cr for period ended Mar 2021 vis-vis 2.21 for period ended Mar 2020 .
Operating Margins contracted -399.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.68 compared to Rs 0.69 for previous quarter ended Dec 2020 and Rs 0.08 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 147.0 cr for period ended Mar 2021 vis-vis sales of Rs 95.0 cr for the period ended Mar 2020, a healthy growth of 35.4%. The 3 year sales cagr stood at 25.1%.
Operating margins shrank to 6.0% for period ended Mar 2021 vis-vis 8.0% for period ended Mar 2020, contraction of 200.0 bps.
Net Profit reported at Rs 1.0 cr for period ended Mar 2021 vis-vis sales of Rs 0.0 cr for the period ended Mar 2020, rising 100.0%.
Company reported a poor Net Profit CAGR of -20.6% over the last 3 years
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 stock has given a return of 46% on a 1 Year basis vis-vis a return of -1% over the last 3 Years. – The compounded sales growth on a TTM bassis is 29% vis-vis a compounded sales growth of 9% over the last 3 Years. – The compounded profit growth on a TTM basis is 88% vis-vis a compounded profit growth of -62% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 32.21% vis-vis 32.59% for Dec 2020
Conclusion
– Stock is trading at 0.75 times its book value
– is expected to give good quarter – 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 2.52% over past five years.
– has a low return on equity of 2.73% 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 27.11 and is trading at 31.8 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
