Mehabe score: 3 G Factor: 6 Piotski Score: 6 The stock has a rating 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 6 and Piotski score of 6.
Description
GHCL is engaged in primarily two segments consisting of Inorganic Chemicals (mainly manufacture and sale of Soda Ash) and Home Textile division (comprising of yarn manufacturing, weaving, processing and cutting and sewing of home textiles products).Site:GHCLMain Symbol:GHCL
Stock trades at 359.0, above its 50dma 285.53. It also trades above its 200dma 235.72. The stock remains bullish on techicals
The 52 week high is at 369.00 and the 52week low is at 135.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
Weakness
– The company has delivered a poor sales growth of 2.76% over past five years.
-Promoter holding is low: 19.18%
Competition
– The industry trades at a mean P/E of 30.4x. Pidilite Inds. trades at the industry’s max P/E of 103.14x. GHCL trades at a P/E of 10.3x
– Industry’s mean G-Factor is 3.8 while the mean Piotski score is 8.0. GHCL has a G-Factor of 6 and Piotski scoreof 6.
– Average 1 month return for industry is 9.2%. The max 1- month return was given by GHCL: a return of 33.59 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 826.0 cr compared to Rs 750.0 cr for period ended Mar 2020, a rise of 10.1%
Operating Profits reported at Rs 195.0 cr for period ended Mar 2021 vis-vis 156.0 for period ended Mar 2020 .
Operating Margins expanded 280.8 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 11.7 compared to Rs 12.37 for previous quarter ended Dec 2020 and Rs 8.93 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2900.0 cr for period ended Mar 2021 vis-vis sales of Rs 3305.0 cr for the period ended Mar 2020, a fall of 14.0%. The 3 year sales cagr stood at -0.2%.
Net Profit reported at Rs 326.0 cr for period ended Mar 2021 vis-vis sales of Rs 397.0 cr for the period ended Mar 2020, falling 21.8%.
Company reported a poor Net Profit CAGR of -2.9% 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 14.0% compared to 18.0% over the last 3 Years. – The stock has given a return of 150% on a 1 Year basis vis-vis a return of 12% over the last 3 Years. – The compounded sales growth on a TTM bassis is -12% vis-vis a compounded sales growth of -0% over the last 3 Years. – The compounded profit growth on a TTM basis is -16% vis-vis a compounded profit growth of -2% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 17.23% vis-vis 15.96% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 42.68% vis-vis 43.76% for Mar 2021
Conclusion
– has reduced debt. – The company has delivered a poor sales growth of 2.76% over past five years.
-Promoter holding is low: 19.18%
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 285.53 and is trading at 359.0, thus bullish price action wise.
