Mehabe score: 6 G Factor: 3 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 3 and Piotski score of 5.
Description
Arvind SmartSpaces is engaged in the development of real estate comprising of residential, commercial and industrial projects.(Source : 201903 Annual Report Page No: 69)Site:ARVSMARTMain Symbol:ARVSMART
Stock trades at 129.0, above its 50dma 118.9. It also trades above its 200dma 104.67. The stock remains bullish on techicals
The 52 week high is at 141.50 and the 52week low is at 78.40
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.78%
-The company has delivered a poor sales growth of 5.36% over past five years.
– has a low return on equity of 9.31% for last 3 years.
-Dividend payout has been low at 5.74% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 42.5x. Phoenix Mills trades at the industry’s max P/E of 285.62x. ARVSMART trades at a P/E of 52.4x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 7.0. ARVSMART has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 8.3%. The max 1- month return was given by Prestige Estates: a return of 24.56 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 26.95 cr compared to Rs 10.54 cr for period ended Jun 2020, a rise of 155.7%
Operating Profits reported at Rs 8.22 cr for period ended Jun 2021 vis-vis 2.16 for period ended Jun 2020 .
Operating Margins expanded 1000.8 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 0.7 compared to Rs 1.85 for previous quarter ended Mar 2021 and Rs -1.36 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 166.0 cr for period ended TTM vis-vis sales of Rs 149.0 cr for the period ended Mar 2021, a healthy growth of 10.2%. The 3 year sales cagr stood at -14.1%.
Operating margins expanded to 28.0% for period ended TTM vis-vis 27.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 16.0 cr for period ended TTM vis-vis sales of Rs 9.0 cr for the period ended Mar 2021, rising 43.8%.
Company reported a poor Net Profit CAGR of -19.8% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 91.0 cr for period ended Mar 2021 vis-vis Rs -16.0 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 3.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 63% on a 1 Year basis vis-vis a return of -10% over the last 3 Years. – The compounded sales growth on a TTM bassis is -50% vis-vis a compounded sales growth of -9% over the last 3 Years. – The compounded profit growth on a TTM basis is -78% vis-vis a compounded profit growth of -34% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.05% vis-vis 0.03% for Mar 2021 – Public shareholding has risen for the period ended Jun 2021. The Jun 2021 public holding stood at 42.76% vis-vis 39.66% for Mar 2021
Conclusion
– has reduced debt. – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.78%
-The company has delivered a poor sales growth of 5.36% over past five years.
– has a low return on equity of 9.31% for last 3 years.
-Dividend payout has been low at 5.74% 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 118.9 and is trading at 129.0 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
