Mehabe score: 5 G Factor: 5 Piotski Score: 8 The stock has a rating . 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 5 and Piotski score of 8.
Description
Kanco Tea & Industries is engaged in Growing of Tea and Processing of Tea.(Source : 201903 Annual Report Page No: 22)Site:541005Main Symbol:KANCOTEA
Stock trades at 64.4, below its 50dma 70.41. However it is trading above its 200dma 56.71. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 70.41.
The 52 week high is at 83.00 and the 52week low is at 26.35
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.53 times its book value
– has delivered good profit growth of 45.17% CAGR over last 5 years
Weakness
– Tax rate seems low
– has a low return on equity of 10.37% for last 3 years.
Competition
– The industry trades at a mean P/E of 13.9x. Tata Consumer trades at the industry’s max P/E of 92.5x. 541005 trades at a P/E of 2.7x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 9.0. 541005 has a G-Factor of 5 and Piotski scoreof 8.
– Average 1 month return for industry is -0.2%. The max 1- month return was given by Tata Coffee: a return of 6.85 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 2.0 cr compared to Rs 4.0 cr for period ended Mar 2020, a fall of 50.0%
Company reported negative operating profit of Rs -10.0 cr for period ended Mar 2021. For same period last year, operating profit was -11.0
The EPS for Mar 2021 was Rs -22.62 compared to Rs -0.57 for previous quarter ended Dec 2020 and Rs -22.08 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 82.0 cr for period ended Mar 2021 vis-vis sales of Rs 60.0 cr for the period ended Mar 2020, a healthy growth of 26.8%. The 3 year sales cagr stood at 15.7%.
Operating margins expanded to 20.0% for period ended Mar 2021 vis-vis 3.0% for period ended Mar 2020, expansion of 1700.0 bps.
Net Profit reported at Rs 11.0 cr for period ended Mar 2021 vis-vis sales of Rs -1.0 cr for the period ended Mar 2020, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 15.0 cr for period ended Mar 2021 vis-vis Rs 2.0 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 21.0% compared to 10.0% over the last 3 Years. – The stock has given a return of 115% on a 1 Year basis vis-vis a return of 3% over the last 3 Years. – The compounded sales growth on a TTM bassis is 37% vis-vis a compounded sales growth of 15% over the last 3 Years. – The compounded profit growth on a TTM basis is 573% vis-vis a compounded profit growth of 248% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 29.25% vis-vis 29.25% for Mar 2021
Conclusion
– Stock is trading at 0.53 times its book value
– has delivered good profit growth of 45.17% CAGR over last 5 years – Tax rate seems low
– has a low return on equity of 10.37% for last 3 years.
