Mehabe score: 4 G Factor: 3 Piotski Score: 4 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 4.
Description
Bhakti Gems & Jewellery is engaged in Manufacturing of Gold Ornaments.Site:540545Main Symbol:BGJL
Stock trades at 20.7, below its 50dma 24.87 and below its 200dma 39.56. The stock remains bearish on technicals
The 52 week high is at 91.95 and the 52week low is at 17.80
Price Chart
P/E Chart
Sales and Margin
Strengths
– is expected to give good quarter
-Debtor days have improved from 34.29 to 23.60 days.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
-Promoter holding has decreased over last quarter: -6.06%
– has a low return on equity of 1.35% for last 3 years.
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 25.4x. Titan Company trades at the industry’s max P/E of 157.95x. 540545 trades at a P/E of 28.4x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 7.0. 540545 has a G-Factor of 3 and Piotski scoreof 4.
– Average 1 month return for industry is 1.9%. The max 1- month return was given by Goldiam Intl.: a return of 29.31 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 10.0 cr compared to Rs 1.7 cr for period ended Jun 2020, a rise of 488.2%
Operating Profits reported at Rs 0.14 cr for period ended Jun 2021 vis-vis 0.41 for period ended Jun 2020 .
Operating Margins contracted -2271.8 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 0.11 compared to Rs -1.81 for previous quarter ended Mar 2021 and Rs 0.29 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 83.65 cr for period ended TTM vis-vis sales of Rs 67.9 cr for the period ended Mar 2021, a healthy growth of 18.8%. The 3 year sales cagr stood at 10.3%.
Operating margins expanded to 1.23% for period ended TTM vis-vis 0.6% for period ended Mar 2021, expansion of 63.0 bps.
Net Profit reported at Rs 0.73 cr for period ended TTM vis-vis sales of Rs 0.27 cr for the period ended Mar 2021, rising 63.0%.
Company recorded a healthy Net Profit CAGR of 118.5% 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 company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 2.0% compared to 1.0% over the last 3 Years. – The stock has given a return of -67% on a 1 Year basis vis-vis a return of 8% over the last 3 Years. – The compounded sales growth on a TTM bassis is 47% vis-vis a compounded sales growth of 20% over the last 3 Years. – The compounded profit growth on a TTM basis is 128% vis-vis a compounded profit growth of 12% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has risen for the period ended Mar 2021. The Mar 2021 public holding stood at 46.97% vis-vis 40.91% for Dec 2020
Conclusion
– is expected to give good quarter
-Debtor days have improved from 34.29 to 23.60 days. – Though the company is reporting repeated profits, it is not paying out dividend
-Promoter holding has decreased over last quarter: -6.06%
– has a low return on equity of 1.35% for last 3 years.
– might be capitalizing the interest cost
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 24.87 and is trading at 20.7. 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
