Mehabe score: 4 G Factor: 1 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 1 and Piotski score of 5.
Description
Agro Tech Foods Ltd is primarily engaged in the business of manufacturing and trading of edible oils and food products.#Site:ATFLMain Symbol:ATFL
Stock trades at 994.0, above its 50dma 961.18. It also trades above its 200dma 855.03. The stock remains bullish on techicals
The 52 week high is at 1149.75 and the 52week low is at 565.60
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
– has been maintaining a healthy dividend payout of 20.92%
Weakness
– Stock is trading at 5.56 times its book value
-The company has delivered a poor sales growth of 2.68% over past five years.
– has a low return on equity of 8.15% for last 3 years.
Competition
– The industry trades at a mean P/E of 30.9x. Manorama Indust. trades at the industry’s max P/E of 102.29x. ATFL trades at a P/E of 92.1x
– Industry’s mean G-Factor is 4.9 while the mean Piotski score is 7.0. ATFL has a G-Factor of 1 and Piotski scoreof 5.
– Average 1 month return for industry is 26.8%. The max 1- month return was given by Vijay Solvex: a return of 119.26 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 206.3 cr compared to Rs 203.39 cr for period ended Jun 2020, a rise of 1.4%
Operating Profits reported at Rs 16.0 cr for period ended Jun 2021 vis-vis 21.07 for period ended Jun 2020 .
Operating Margins contracted -260.4 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 3.1 compared to Rs 0.7 for previous quarter ended Mar 2021 and Rs 5.14 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 895.0 cr for period ended TTM vis-vis sales of Rs 893.0 cr for the period ended Mar 2021, a growth of 0.2%. The 3 year sales cagr stood at 2.8%.
Operating margins shrank to 6.0% for period ended TTM vis-vis 7.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 26.0 cr for period ended TTM vis-vis sales of Rs 31.0 cr for the period ended Mar 2021, falling 19.2%.
Company reported a poor Net Profit CAGR of -8.6% 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 62.0 cr for period ended Mar 2021 vis-vis Rs 43.0 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 7.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 68% on a 1 Year basis vis-vis a return of 16% over the last 3 Years. – The compounded sales growth on a TTM bassis is 6% vis-vis a compounded sales growth of 3% over the last 3 Years. – The compounded profit growth on a TTM basis is -33% vis-vis a compounded profit growth of -0% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 7.6% vis-vis 7.61% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 35.41% vis-vis 34.76% for Mar 2021
Conclusion
– has reduced debt.
– is almost debt free.
– has been maintaining a healthy dividend payout of 20.92% – Stock is trading at 5.56 times its book value
-The company has delivered a poor sales growth of 2.68% over past five years.
– has a low return on equity of 8.15% 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 961.18 and is trading at 994.0 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
