Mehabe score: 2 G Factor: 5 Piotski Score: 2 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 5 and Piotski score of 2.
Description
Ashima is engaged in the business of manufacture of 100% cotton Yarn Dyed Shirting fabrics and Denim fabrics. It offers a wide range of products including basic denims, ring/slub denims, pigment/discharged print, polyester denim, various yarn dyed fabrics like stripes, chambrays, twills, oxford, herringbones, indigo checks, pique, satin, dobbies, etc.(Source : 202003-01 Annual Report Page No:79)Site:ASHIMASYNMain Symbol:ASHIMASYN
Stock trades at 19.8, above its 50dma 19.11. It also trades above its 200dma 15.09. The stock remains bullish on techicals
The 52 week high is at 21.50 and the 52week low is at 5.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -7.88% over past five years.
– has a low return on equity of -2.53% for last 3 years.
-Debtor days have increased from 28.22 to 36.56 days.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 17.9x. Arvind Ltd trades at the industry’s max P/E of 1200.31x. ASHIMASYN trades at a P/E of x
– Industry’s mean G-Factor is 4.2 while the mean Piotski score is 8.0. ASHIMASYN has a G-Factor of 5 and Piotski scoreof 2.
– Average 1 month return for industry is 33.9%. The max 1- month return was given by Rajapalayam Mill: a return of 53.25 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 48.72 cr compared to Rs 57.32 cr for period ended Mar 2020, a fall of 15.0%
Company reported operating profit of Rs 0.67 cr for period ended Mar 2021, operating profit margin at 1.4 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Mar 2021 was Rs 0.04 compared to Rs -0.13 for previous quarter ended Dec 2020 and Rs -0.09 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 141.0 cr for period ended Mar 2021 vis-vis sales of Rs 285.0 cr for the period ended Mar 2020, a fall of 102.1%. The 3 year sales cagr stood at -15.0%.
Operating margins shrank to -10.0% for period ended Mar 2021 vis-vis -1.0% for period ended Mar 2020, contraction of 900.0 bps.
Net Profit reported at Rs -12.0 cr for period ended Mar 2021 vis-vis sales of Rs -3.0 cr for the period ended Mar 2020, falling 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 stock has given a return of 260% on a 1 Year basis vis-vis a return of -7% over the last 3 Years. – The compounded sales growth on a TTM bassis is -50% vis-vis a compounded sales growth of -15% over the last 3 Years. – The compounded profit growth on a TTM basis is -81% vis-vis a compounded profit growth of 11% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.32% vis-vis 0.32% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 26.19% vis-vis 26.19% for Mar 2021
Conclusion
– is almost debt free. – has low interest coverage ratio.
-The company has delivered a poor sales growth of -7.88% over past five years.
– has a low return on equity of -2.53% for last 3 years.
-Debtor days have increased from 28.22 to 36.56 days.
-‘s cost of borrowing seems high
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 19.11 and is trading at 19.8 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
