Mehabe score: 4 G Factor: 6 Piotski Score: 7 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 7.
Description
Kesoram Industries is a multi-product and multi-location company. Automobile tyre business and Cement are its core businesses. The Company markets its automobile tyres under the brand name Birla Tyres and cement is marketed under Birla Shakti brand.(Source : 201903 Annual Report Page No: 77)Site:KESORAMINDMain Symbol:KESORAMIND
Stock trades at 91.6, above its 50dma 82.52. It also trades above its 200dma 67.12. The stock remains bullish on techicals
The 52 week high is at 96.85 and the 52week low is at 30.80
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 7.64 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -7.17%
– has a low return on equity of -55.19% for last 3 years.
-Promoters have pledged 45.78% of their holding.
Competition
– The industry trades at a mean P/E of 29.5x. Voltas trades at the industry’s max P/E of 63.88x. KESORAMIND trades at a P/E of 4.18x
– Industry’s mean G-Factor is 4.7 while the mean Piotski score is 7.0. KESORAMIND has a G-Factor of 6 and Piotski scoreof 7.
– Average 1 month return for industry is 9.6%. The max 1- month return was given by DCM Shriram: a return of 23.92 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 862.0 cr compared to Rs 532.0 cr for period ended Mar 2020, a rise of 62.0%
Operating Profits reported at Rs 115.0 cr for period ended Mar 2021 vis-vis 8.0 for period ended Mar 2020 .
Operating Margins expanded 1183.7 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 5.85 compared to Rs 3.75 for previous quarter ended Dec 2020 and Rs -5.76 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2653.0 cr for period ended Mar 2021 vis-vis sales of Rs 2646.0 cr for the period ended Mar 2020, a growth of 0.3%. The 3 year sales cagr stood at -11.8%.
Operating margins expanded to 14.0% for period ended Mar 2021 vis-vis 9.0% for period ended Mar 2020, expansion of 500.0 bps.
Net Profit reported at Rs 140.0 cr for period ended Mar 2021 vis-vis sales of Rs -188.0 cr for the period ended Mar 2020, rising 0%.
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 improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 720.0% compared to -55.0% over the last 3 Years. – The stock has given a return of 166% on a 1 Year basis vis-vis a return of 9% over the last 3 Years. – The compounded sales growth on a TTM bassis is 0% vis-vis a compounded sales growth of -12% over the last 3 Years. – The compounded profit growth on a TTM basis is 293% vis-vis a compounded profit growth of 40% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 0.03% vis-vis 0.0% for Dec 2020 – Public shareholding has fallen for the period ended Mar 2021. The Mar 2021 public holding stood at 38.01% vis-vis 43.07% for Dec 2020
Conclusion
– – Stock is trading at 7.64 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -7.17%
– has a low return on equity of -55.19% for last 3 years.
-Promoters have pledged 45.78% of their holding.
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 82.52 and is trading at 91.6, thus bullish price action wise.
