Mehabe score: 4 G Factor: 2 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 2 and Piotski score of 5.
Description
Dynamic Cables is one of the leading manufacturers and suppliers of cables & conductors.(Source : 201903 Annual Report Page No: 32)Site:540795Main Symbol:DYNAMIC
Stock trades at 52.7, above its 50dma 45.04. It also trades above its 200dma 35.29. The stock remains bullish on techicals
The 52 week high is at 54.00 and the 52week low is at 20.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.99 times its book value
Weakness
– The company has delivered a poor sales growth of 5.05% over past five years.
-Contingent liabilities of Rs.72.12 Cr.
-Dividend payout has been low at 3.73% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 33.6x. Paramount Comm. trades at the industry’s max P/E of 98.99x. 540795 trades at a P/E of 11.8x
– Industry’s mean G-Factor is 3.9 while the mean Piotski score is 7.0. 540795 has a G-Factor of 2 and Piotski scoreof 5.
– Average 1 month return for industry is -4.0%. The max 1- month return was given by Dynamic Cables: a return of 12.61 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 114.49 cr compared to Rs 87.26 cr for period ended Jun 2017, a rise of 31.2%
Operating Profits reported at Rs 12.02 cr for period ended Jun 2021 vis-vis 5.01 for period ended Jun 2017 .
Operating Margins expanded 475.7 bps for period ended Jun 2021 vis-vis Jun 2017 .
The EPS for Jun 2021 was Rs 2.48 compared to Rs 2.43 for previous quarter ended Mar 2021 and Rs 1.9 for Jun 2017
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 343.0 cr for period ended Mar 2021 vis-vis sales of Rs 429.0 cr for the period ended Mar 2020, a fall of 25.1%. The 3 year sales cagr stood at -1.3%.
Operating margins shrank to 7.0% for period ended Mar 2021 vis-vis 11.0% for period ended Mar 2020, contraction of 400.0 bps.
Net Profit reported at Rs 10.0 cr for period ended Mar 2021 vis-vis sales of Rs 18.0 cr for the period ended Mar 2020, falling 80.0%.
Company recorded a healthy Net Profit CAGR of 12.6% over the last 3 years
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 9.0% compared to 17.0% over the last 3 Years. – The stock has given a return of 120% on a 1 Year basis vis-vis a return of 9% over the last 3 Years. – The compounded sales growth on a TTM bassis is -20% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is -46% vis-vis a compounded profit growth of 10% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.03% vis-vis 0.03% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 25.81% vis-vis 25.81% for Mar 2021
Conclusion
– Stock is trading at 0.99 times its book value – The company has delivered a poor sales growth of 5.05% over past five years.
-Contingent liabilities of Rs.72.12 Cr.
-Dividend payout has been low at 3.73% of profits over 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 45.04 and is trading at 52.7 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
