Mehabe score: 2 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
Uday Jewellery Industries is engaged in the business of manufacturing, sale and trading of stone studded gold jewellery, diamond studded jewellery and silver items and operates in different geographical areas i.e. domestic sales and export sales.Site:539518
Market Cap:
Rs 253 cr
Price:
115.0
Trading pe:
31.4x
Book-value:
22.4/share
Div yield:
0.00 %
Earning yield:
4.21%
Face-value:
10.0/share
52week high:
199.35
52week low:
72.10
Technical Analysis
Stock trades at 115.0, below its 50dma 115.97 and below its 200dma 118.63. The stock remains bearish on technicals
The 52 week high is at 199.35 and the 52week low is at 72.10
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
– has delivered good profit growth of 42.29% CAGR over last 5 years
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 12.95% for last 3 years.
Competition
– The industry trades at a mean P/E of 23.8x. Titan Company trades at the industry’s max P/E of 158.0x. 539518 trades at a P/E of 31.4x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 7.0. 539518 has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 2.9%. The max 1- month return was given by Kalyan Jewellers: a return of 14.06 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 38.43 cr compared to Rs 24.76 cr for period ended Mar 2020, a rise of 55.2%
Operating Profits reported at Rs 1.5 cr for period ended Mar 2021 vis-vis 4.25 for period ended Mar 2020 .
Operating Margins contracted -1326.2 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.39 compared to Rs 1.16 for previous quarter ended Dec 2020 and Rs 1.42 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 93.34 cr for period ended Mar 2021 vis-vis sales of Rs 91.74 cr for the period ended Mar 2020, a growth of 1.7%. The 3 year sales cagr stood at 9.3%.
Operating margins shrank to 8.04% for period ended Mar 2021 vis-vis 10.95% for period ended Mar 2020, contraction of 291.0 bps.
Net Profit reported at Rs 5.8 cr for period ended Mar 2021 vis-vis sales of Rs 6.94 cr for the period ended Mar 2020, falling 19.7%.
Company recorded a healthy Net Profit CAGR of 34.6% over the last 3 years
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 -1.74 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 17.0% compared to 13.0% over the last 3 Years. – The stock has given a return of 43% on a 1 Year basis vis-vis a return of 18% over the last 3 Years. – The compounded sales growth on a TTM bassis is -7% vis-vis a compounded sales growth of 27% over the last 3 Years. – The compounded profit growth on a TTM basis is 75% vis-vis a compounded profit growth of 78% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 26.47% vis-vis 26.53% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free.
– has delivered good profit growth of 42.29% CAGR over last 5 years – Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 12.95% for last 3 years.
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 115.97 and is trading at 115.0. 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
