Mehabe score: 2 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
G G Engineering Limited manufactures and sells fabricated structure and diesel generators in India.Site:540614Main Symbol:GGENG
Stock trades at 19.8, below its 50dma 23.31 and below its 200dma 20.98. The stock remains bearish on technicals
The 52 week high is at 30.00 and the 52week low is at 11.60
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– Stock is trading at 7.25 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last 3 years: -19.40%
Competition
– The industry trades at a mean P/E of 23.4x. Greaves Cotton trades at the industry’s max P/E of 162.54x. 540614 trades at a P/E of x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 7.0. 540614 has a G-Factor of 3 and Piotski scoreof 4.
– Average 1 month return for industry is -7.8%. The max 1- month return was given by Cummins India: a return of 20.63 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 4.79 cr compared to Rs 6.85 cr for period ended Jun 2020, a fall of 30.1%
Company reported operating profit of Rs 0.21 cr for period ended Jun 2021, operating profit margin at 4.4 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Jun 2021 was Rs -0.06 compared to Rs -0.09 for previous quarter ended Mar 2021 and Rs -0.09 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 35.36 cr for period ended TTM vis-vis sales of Rs 37.42 cr for the period ended Mar 2021, a fall of 5.8%. The 3 year sales cagr stood at -24.5%.
Operating margins expanded to 3.9% for period ended TTM vis-vis 2.94% for period ended Mar 2021, expansion of 96.0 bps.
Net Profit reported at Rs -0.62 cr for period ended TTM vis-vis sales of Rs -0.82 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
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 -6.0% compared to 0% over the last 3 Years. – The stock has given a return of 51% on a 1 Year basis vis-vis a return of 39% over the last 3 Years. – The compounded sales growth on a TTM bassis is 41% vis-vis a compounded sales growth of % over the last 3 Years. – The compounded profit growth on a TTM basis is 23% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 37.85% vis-vis 37.85% for Mar 2021
Conclusion
– – Stock is trading at 7.25 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last 3 years: -19.40%
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 23.31 and is trading at 19.8. 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
