Mehabe score: 2 G Factor: 4 Piotski Score: 3 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 4 and Piotski score of 3.
Description
Gautam Gems has been principally incorporated as a Importer, Exporter and Manufacturer of rough and polished diamonds. sell diamonds of multiple category, shape, cut, size and color.Site:540936Main Symbol:GGL
Stock trades at 10.2, below its 50dma 12.34 and below its 200dma 21.0. The stock remains bearish on technicals
The 52 week high is at 65.15 and the 52week low is at 8.27
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.74 times its book value
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 2.73% for last 3 years.
– might be capitalizing the interest cost
-Promoter holding has decreased over last 3 years: -6.07%
Competition
– The industry trades at a mean P/E of 24.5x. Titan Company trades at the industry’s max P/E of 166.77x. 540936 trades at a P/E of 30.1x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 7.0. 540936 has a G-Factor of 4 and Piotski scoreof 3.
– Average 1 month return for industry is 7.6%. The max 1- month return was given by Thangamayil Jew.: a return of 26.94 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 38.75 cr compared to Rs 0.01 cr for period ended Jun 2020, a rise of 387400.0%
Company reported operating profit of Rs 0.81 cr for period ended Sep 2021, operating profit margin at 2.1 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Sep 2021 was Rs 0.8 compared to Rs 0.24 for previous quarter ended Jun 2021 and Rs -0.01 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 169.0 cr for period ended TTM vis-vis sales of Rs 94.0 cr for the period ended Mar 2021, a healthy growth of 44.4%. The 3 year sales cagr stood at 56.6%.
Net Profit reported at Rs 1.0 cr for period ended TTM vis-vis sales of Rs 0.0 cr for the period ended Mar 2021, rising 0%.
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 3.0% over the last 3 Years. – The stock has given a return of -64% on a 1 Year basis vis-vis a return of -43% over the last 3 Years. – The compounded sales growth on a TTM bassis is -71% vis-vis a compounded sales growth of 48% over the last 3 Years. – The compounded profit growth on a TTM basis is -40% vis-vis a compounded profit growth of 62% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Sep 2021 public holding stood at 44.33% vis-vis 44.33% for Jun 2021
Conclusion
– Stock is trading at 0.74 times its book value – Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 2.73% for last 3 years.
– might be capitalizing the interest cost
-Promoter holding has decreased over last 3 years: -6.07%
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 12.34 and is trading at 10.2. 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
