Mehabe score: 3 G Factor: 3 Piotski Score: 6 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 6.
Description
Bajaj Holdings & Investment in the business of Investment activity.Site:BAJAJHLDNGMain Symbol:BAJAJHLDNG
Stock trades at 3816.0, above its 50dma 3655.04. It also trades above its 200dma 3331.88. The stock remains bullish on techicals
The 52 week high is at 4060.00 and the 52week low is at 2212.65
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 1.14 times its book value
Weakness
– The company has delivered a poor sales growth of -0.56% over past five years.
-Tax rate seems low
– has a low return on equity of 11.28% for last 3 years.
-Earnings include an other income of Rs.3451.48 Cr.
-Dividend payout has been low at 12.98% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 26.4x. SBI Cards trades at the industry’s max P/E of 92.21x. BAJAJHLDNG trades at a P/E of 11.6x
– Industry’s mean G-Factor is 3.7 while the mean Piotski score is 6.0. BAJAJHLDNG has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 1.9%. The max 1- month return was given by Bajaj Holdings: a return of 9.06 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 98.0 cr compared to Rs 90.0 cr for period ended Jun 2020, a rise of 8.9%
Operating Profits reported at Rs 69.0 cr for period ended Jun 2021 vis-vis 68.0 for period ended Jun 2020 .
Operating Margins contracted -514.7 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 69.96 compared to Rs 85.27 for previous quarter ended Mar 2021 and Rs 61.02 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 407.0 cr for period ended TTM vis-vis sales of Rs 457.0 cr for the period ended Mar 2021, a fall of 12.3%. The 3 year sales cagr stood at -1.9%.
Operating margins shrank to 73.0% for period ended TTM vis-vis 77.0% for period ended Mar 2021, contraction of 400.0 bps.
Net Profit reported at Rs 3749.0 cr for period ended TTM vis-vis sales of Rs 3650.0 cr for the period ended Mar 2021, rising 2.6%.
Company recorded a Net Profit CAGR of 7.1% 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 11.0% compared to 11.0% over the last 3 Years. – The stock has given a return of 43% on a 1 Year basis vis-vis a return of 8% over the last 3 Years. – The compounded sales growth on a TTM bassis is 5% vis-vis a compounded sales growth of 3% over the last 3 Years. – The compounded profit growth on a TTM basis is 22% 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 13.68% vis-vis 14.39% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 32.08% vis-vis 31.99% for Mar 2021
Conclusion
– is almost debt free.
-Stock is trading at 1.14 times its book value – The company has delivered a poor sales growth of -0.56% over past five years.
-Tax rate seems low
– has a low return on equity of 11.28% for last 3 years.
-Earnings include an other income of Rs.3451.48 Cr.
-Dividend payout has been low at 12.98% 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 3655.04 and is trading at 3816.0 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
