Mehabe score: 3 G Factor: 4 Piotski Score: 4 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 4 and Piotski score of 4.
Description
Artemis Medicare Services Ltd (AMSL) was incorporated on 2004, by the promoters of the Apollo Tyres Group, is engaged in healthcare business. AMSL operates a 318-bedded multi-specialty tertiary care hospital in Gurgaon. It has specialization in various segments like Orthopedics & Joint Replacement, Oncology, Cardiovascular, Neurosciences and Bariatric & Minimally Invasive Surgery. AMSL has been awarded with the NABH accreditation.
Main Points
Upcoming Capex:
Company has planned a brownfield expansion wherein, it will construct a new block of 144 beds at its existing location in Gurgaon.
Estimated cost of the project is 168 Cr, to be funded by a mix of debt-equity.
Project construction is underway and is expected to complete by Q1FY22.
This project was envisaged in 2017 and was expected to be operational by 2019. But, was suspended by the order of HSPCB and it got delayed by a few years.Site:ARTEMISMED
Market Cap:
Rs 394 cr
Price:
297.0
Trading pe:
59.4x
Book-value:
243/share
Div yield:
0.00 %
Earning yield:
3.70%
Face-value:
10.0/share
52week high:
321.90
52week low:
135.00
Technical Analysis
Stock trades at 297.0, above its 50dma 264.67. It also trades above its 200dma 223.26. The stock remains bullish on techicals
The 52 week high is at 321.90 and the 52week low is at 135.00
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 0.01% over past five years.
– has a low return on equity of 5.54% for last 3 years.
Competition
– The industry trades at a mean P/E of 38.8x. Max Healthcare trades at the industry’s max P/E of 499.78x. ARTEMISMED trades at a P/E of 59.4x
– Industry’s mean G-Factor is 4.9 while the mean Piotski score is 9.0. ARTEMISMED has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 7.3%. The max 1- month return was given by Metropolis Healt: a return of 19.99 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 127.0 cr compared to Rs 137.0 cr for period ended Mar 2020, a fall of 7.3%
Operating Profits reported at Rs 20.0 cr for period ended Mar 2021 vis-vis 13.0 for period ended Mar 2020 .
Operating Margins expanded 625.9 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 9.66 compared to Rs 4.15 for previous quarter ended Dec 2020 and Rs 3.38 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 402.0 cr for period ended Mar 2021 vis-vis sales of Rs 563.0 cr for the period ended Mar 2020, a fall of 40.0%. The 3 year sales cagr stood at -7.2%.
Operating margins shrank to 9.0% for period ended Mar 2021 vis-vis 11.0% for period ended Mar 2020, contraction of 200.0 bps.
Net Profit reported at Rs 7.0 cr for period ended Mar 2021 vis-vis sales of Rs 20.0 cr for the period ended Mar 2020, falling 185.7%.
Company reported a poor Net Profit CAGR of -36.2% 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 2.0% compared to 6.0% over the last 3 Years. – The stock has given a return of 48% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is -29% vis-vis a compounded sales growth of -7% over the last 3 Years. – The compounded profit growth on a TTM basis is -68% vis-vis a compounded profit growth of -38% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 21.59% vis-vis 21.59% for Dec 2020
Conclusion
– – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 0.01% over past five years.
– has a low return on equity of 5.54% for 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 264.67 and is trading at 297.0 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
