Mehabe score: 5 G Factor: 7 Piotski Score: 8 The stock has a rating BUY. 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 7 and Piotski score of 8.
Description
Norben Tea & Exports is engaged in the business of growing and manufacturing of Tea and providing Commission.(Source : 201903 Annual Report Page No:48)Site:NORBTEAEXPMain Symbol:NORBTEAEXP
Stock trades at 6.35, below its 50dma 6.44 and below its 200dma 7.02. The stock remains bearish on technicals
The 52 week high is at 16.25 and the 52week low is at 3.95
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.50 times its book value
Weakness
– has a low return on equity of -1.72% for last 3 years.
Competition
– The industry trades at a mean P/E of 14.4x. Tata Consumer trades at the industry’s max P/E of 80.29x. NORBTEAEXP trades at a P/E of 6.32x
– Industry’s mean G-Factor is 4.6 while the mean Piotski score is 9.0. NORBTEAEXP has a G-Factor of 7 and Piotski scoreof 8.
– Average 1 month return for industry is 4.9%. The max 1- month return was given by Rossell India: a return of 23.99 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 0.97 cr compared to Rs 0.66 cr for period ended Mar 2020, a rise of 47.0%
Company reported operating profit of Rs 0.08 cr for period ended Mar 2021, operating profit margin at 8.2 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Mar 2021 was Rs -0.34 compared to Rs 0.17 for previous quarter ended Dec 2020 and Rs -1.12 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 7.46 cr for period ended Mar 2021 vis-vis sales of Rs 4.87 cr for the period ended Mar 2020, a healthy growth of 34.7%. The 3 year sales cagr stood at 17.1%.
Operating margins expanded to 32.31% for period ended Mar 2021 vis-vis -8.01% for period ended Mar 2020, expansion of 4032.0 bps.
Net Profit reported at Rs 1.18 cr for period ended Mar 2021 vis-vis sales of Rs -1.61 cr for the period ended Mar 2020, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 2.35 cr for period ended Mar 2021 vis-vis Rs 0.29 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 improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 8.0% compared to -2.0% over the last 3 Years. – The stock has given a return of 61% on a 1 Year basis vis-vis a return of -15% over the last 3 Years. – The compounded sales growth on a TTM bassis is 53% vis-vis a compounded sales growth of 17% over the last 3 Years. – The compounded profit growth on a TTM basis is 173% vis-vis a compounded profit growth of 195% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Jun 2021 public holding stood at 48.43% vis-vis 48.43% for Mar 2021
Conclusion
– Stock is trading at 0.50 times its book value – has a low return on equity of -1.72% for last 3 years.
Fundamentally, the stock remains a Strong ‘BUY’ in our long term portoflio.
Technically, the stock has shown near term lack of bullish momentum. The stock remains below its 50 DMA 6.44 and is trading at 6.35.While this may be due to profit taking in near term, we suggest to observe price action. However as investors, this may be a good time to accumalate into a fundamentally solid stock for the next 5 to 10 years
Thus, we retain a BUY for the longer term window, 5-10 years. For the near term, as traders, we suggest to observe price action and buy on bullish breakout.
