Mehabe score: 2 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
Emmbi Industries the principal activities of the Company comprises of Manufacturing and Trading of HDPE & PP – Woven Polymer Based Products.Site:EMMBI
Market Cap:
Rs 176 cr
Price:
99.7
Trading pe:
21.1x
Book-value:
73.4/share
Div yield:
0.40 %
Earning yield:
7.50%
Face-value:
10.0/share
52week high:
112.00
52week low:
61.75
Technical Analysis
Stock trades at 99.7, above its 50dma 95.76. It also trades above its 200dma 86.45. The stock remains bullish on techicals
The 52 week high is at 112.00 and the 52week low is at 61.75
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 10.59% over past five years.
-Dividend payout has been low at 5.20% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 15.4x. EPL Ltd trades at the industry’s max P/E of 35.17x. EMMBI trades at a P/E of 21.1x
– Industry’s mean G-Factor is 4.8 while the mean Piotski score is 9.0. EMMBI has a G-Factor of 1 and Piotski scoreof 5.
– Average 1 month return for industry is 7.8%. The max 1- month return was given by EPL Ltd: a return of 20.02 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 92.54 cr compared to Rs 74.68 cr for period ended Mar 2020, a rise of 23.9%
Operating Profits reported at Rs 8.71 cr for period ended Mar 2021 vis-vis 8.57 for period ended Mar 2020 .
Operating Margins contracted -206.3 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 1.73 compared to Rs 1.33 for previous quarter ended Dec 2020 and Rs 2.11 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 274.0 cr for period ended Mar 2021 vis-vis sales of Rs 303.0 cr for the period ended Mar 2020, a fall of 10.6%. The 3 year sales cagr stood at 2.6%.
Operating margins shrank to 10.0% for period ended Mar 2021 vis-vis 12.0% for period ended Mar 2020, contraction of 200.0 bps.
Net Profit reported at Rs 8.0 cr for period ended Mar 2021 vis-vis sales of Rs 15.0 cr for the period ended Mar 2020, falling 87.5%.
Company reported a poor Net Profit CAGR of -18.9% 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 stock has given a return of 36% on a 1 Year basis vis-vis a return of -10% over the last 3 Years. – The compounded sales growth on a TTM bassis is -16% vis-vis a compounded sales growth of 10% over the last 3 Years. – The compounded profit growth on a TTM basis is -47% vis-vis a compounded profit growth of 5% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 6.91% vis-vis 6.91% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 32.09% vis-vis 32.18% for Dec 2020
Conclusion
– – has low interest coverage ratio.
-The company has delivered a poor sales growth of 10.59% over past five years.
-Dividend payout has been low at 5.20% 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 95.76 and is trading at 99.7 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
