Mehabe score: 6 G Factor: 4 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 4 and Piotski score of 6.
Description
Having started its operations in 1920 as Gahagan Paints & Varnish in Mumbai, Kansai Nerolac Paints is principally engaged in the manufacturing of Paints and is a market leader in Industrial coatings. #
Main Points
Leading player in domestic Industrial paint industry
KNPL is a leader in Industrial coatings. Leveraging its position as priority supplier across various automotive OEMs and ancillaries, the company now has substantial presence in Performance coatings & Powder coating.
It has continued to venture into newer areas of Wood coating, Adhesives, Transportation coatings, Coil & Rebar coatings ,Super durable powders, Construction chemicals.Site:KANSAINERMain Symbol:KANSAINER
Stock trades at 626.0, above its 50dma 593.81. It also trades above its 200dma 562.31. The stock remains bullish on techicals
The 52 week high is at 680.00 and the 52week low is at 416.15
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has been maintaining a healthy dividend payout of 38.98%
Weakness
– Stock is trading at 8.32 times its book value
-The company has delivered a poor sales growth of 6.14% over past five years.
– has a low return on equity of 13.96% for last 3 years.
Competition
– The industry trades at a mean P/E of 96.0x. Hardcast.& Waud trades at the industry’s max P/E of 1795.0x. KANSAINER trades at a P/E of 63.7x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 8.0. KANSAINER has a G-Factor of 4 and Piotski scoreof 6.
– Average 1 month return for industry is 3.8%. The max 1- month return was given by Hardcast.& Waud: a return of 16.56 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 1403.0 cr compared to Rs 639.0 cr for period ended Jun 2020, a rise of 119.6%
Operating Profits reported at Rs 191.0 cr for period ended Jun 2021 vis-vis 77.0 for period ended Jun 2020 .
Operating Margins expanded 156.4 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 2.12 compared to Rs 2.31 for previous quarter ended Mar 2021 and Rs 0.62 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 5838.0 cr for period ended TTM vis-vis sales of Rs 5074.0 cr for the period ended Mar 2021, a healthy growth of 13.1%. The 3 year sales cagr stood at 2.5%.
Net Profit reported at Rs 610.0 cr for period ended TTM vis-vis sales of Rs 530.0 cr for the period ended Mar 2021, rising 13.1%.
Company recorded a healthy Net Profit CAGR of 10.4% 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 646.0 cr for period ended Mar 2021 vis-vis Rs 595.0 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 14.0% compared to 14.0% over the last 3 Years. – The stock has given a return of 49% 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 -4% vis-vis a compounded sales growth of 3% over the last 3 Years. – The compounded profit growth on a TTM basis is 2% vis-vis a compounded profit growth of 1% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 3.72% vis-vis 3.73% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 9.71% vis-vis 8.42% for Mar 2021
Conclusion
– is almost debt free.
– has been maintaining a healthy dividend payout of 38.98% – Stock is trading at 8.32 times its book value
-The company has delivered a poor sales growth of 6.14% over past five years.
– has a low return on equity of 13.96% for last 3 years.
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 593.81 and is trading at 626.0, thus bullish price action wise.
