Mehabe score: 1 G Factor: 3 Piotski Score: 4 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 3 and Piotski score of 4.
Description
The Company is into manufacturing of agrochemical active ingredients (technical), bulk and formulations, intermediate products and it sells its products in India as well as exports them to approximately 24 countries.
Astec also has undertaken a number of custom synthesis projects, for its clients in Europe, Japan and the US. It is present only in business to business sale (B2B).Site:ASTECMain Symbol:ASTEC
Stock trades at 1234.0, below its 50dma 1323.42. However it is trading above its 200dma 1224.91. 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 1323.42.
The 52 week high is at 1530.00 and the 52week low is at 908.15
Price Chart
P/E Chart
Sales and Margin
Strengths
– has delivered good profit growth of 59.90% CAGR over last 5 years
Weakness
– Stock is trading at 7.82 times its book value
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 26.6x. P I Industries trades at the industry’s max P/E of 57.72x. ASTEC trades at a P/E of 39.0x
– Industry’s mean G-Factor is 2.9 while the mean Piotski score is 9.0. ASTEC has a G-Factor of 3 and Piotski scoreof 4.
– Average 1 month return for industry is -4.2%. The max 1- month return was given by India Pesticides: a return of 4.65 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 129.0 cr compared to Rs 112.0 cr for period ended Jun 2020, a rise of 15.2%
Operating Profits reported at Rs 25.0 cr for period ended Jun 2021 vis-vis 28.0 for period ended Jun 2020 .
Operating Margins contracted -562.0 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 6.63 compared to Rs 12.23 for previous quarter ended Mar 2021 and Rs 8.27 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 572.0 cr for period ended TTM vis-vis sales of Rs 555.0 cr for the period ended Mar 2021, a growth of 3.0%. The 3 year sales cagr stood at 9.9%.
Operating margins shrank to 19.0% for period ended TTM vis-vis 20.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 62.0 cr for period ended TTM vis-vis sales of Rs 65.0 cr for the period ended Mar 2021, falling 4.8%.
Company recorded a healthy Net Profit CAGR of 19.9% over the last 3 years
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 23.0% compared to 22.0% over the last 3 Years. – The stock has given a return of 10% on a 1 Year basis vis-vis a return of 32% over the last 3 Years. – The compounded sales growth on a TTM bassis is 3% vis-vis a compounded sales growth of 15% over the last 3 Years. – The compounded profit growth on a TTM basis is -5% vis-vis a compounded profit growth of 26% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 0.22% vis-vis 0.19% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 22.37% vis-vis 23.68% for Jun 2021
Conclusion
– has delivered good profit growth of 59.90% CAGR over last 5 years – Stock is trading at 7.82 times its book value
– might be capitalizing the interest cost
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 1323.42 and is trading at 1234.0. 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
