Mehabe score: 2 G Factor: 4 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 4 and Piotski score of 4.
Description
Bhagyanagar India is engaged in the business of Manufacture of Copper and other copper products and alloys.Site:BHAGYANGRMain Symbol:BHAGYNAGAR
Stock trades at 49.2, below its 50dma 49.83. However it is trading above its 200dma 41.33. 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 49.83.
The 52 week high is at 60.40 and the 52week low is at 16.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is expected to give good quarter
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
– has a low return on equity of 2.88% for last 3 years.
– might be capitalizing the interest cost
-Debtor days have increased from 31.95 to 41.04 days.
Competition
– The industry trades at a mean P/E of 17.6x. Bhagyanagar Ind trades at the industry’s max P/E of 45.19x. BHAGYANGR trades at a P/E of 45.2x
– Industry’s mean G-Factor is 5.2 while the mean Piotski score is 9.0. BHAGYANGR has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 10.7%. The max 1- month return was given by Indian Metals: a return of 44.69 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 326.81 cr compared to Rs 83.48 cr for period ended Jun 2020, a rise of 291.5%
Operating Profits reported at Rs 7.57 cr for period ended Jun 2021 vis-vis 3.02 for period ended Jun 2020 .
Operating Margins contracted -130.1 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 0.71 compared to Rs 0.21 for previous quarter ended Mar 2021 and Rs 0.07 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1031.0 cr for period ended TTM vis-vis sales of Rs 787.0 cr for the period ended Mar 2021, a healthy growth of 23.7%. The 3 year sales cagr stood at 21.9%.
Net Profit reported at Rs 6.0 cr for period ended TTM vis-vis sales of Rs 3.0 cr for the period ended Mar 2021, rising 50.0%.
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 company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 3.0% compared to 3.0% over the last 3 Years. – The stock has given a return of 178% 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 40% vis-vis a compounded sales growth of 15% over the last 3 Years. – The compounded profit growth on a TTM basis is 291% vis-vis a compounded profit growth of -14% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 24.86% vis-vis 24.86% for Mar 2021
Conclusion
– is expected to give good quarter – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
– has a low return on equity of 2.88% for last 3 years.
– might be capitalizing the interest cost
-Debtor days have increased from 31.95 to 41.04 days.
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 49.83 and is trading at 49.2. 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
