Mehabe score: 7 G Factor: 5 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 5 and Piotski score of 6.
Description
Incorporated in the year 1943, Radico Khaitan is one of the most recognised IMFL (Indian Made Foreign Liquor) brands in India. #
Main Points
Strong portfolio of Branded products
Radico Khaitan is one of the largest and oldest manufacturer of IMFL(Indian Made Foreign Liquor). Company has wide range of branded portfolio across IMFL categories of Whisky, Brandy, Rum and White spirits. Currently it has four milloniare brands which are 8 PM Whisky, Contessa Rum, Old Admiral Brandy and Magic Moments Vodka.Site:RADICOMain Symbol:RADICO
Stock trades at 826.0, above its 50dma 728.64. It also trades above its 200dma 580.76. The stock remains bullish on techicals
The 52 week high is at 878.75 and the 52week low is at 360.50
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– has delivered good profit growth of 28.15% CAGR over last 5 years
Weakness
– The company has delivered a poor sales growth of 8.04% over past five years.
Competition
– The industry trades at a mean P/E of 31.5x. United Breweries trades at the industry’s max P/E of 319.82x. RADICO trades at a P/E of 39.9x
– Industry’s mean G-Factor is 4.4 while the mean Piotski score is 9.0. RADICO has a G-Factor of 5 and Piotski scoreof 6.
– Average 1 month return for industry is 7.9%. The max 1- month return was given by Jubilant Inds.: a return of 37.39 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 695.0 cr compared to Rs 585.0 cr for period ended Mar 2020, a rise of 18.8%
Operating Profits reported at Rs 101.0 cr for period ended Mar 2021 vis-vis 82.0 for period ended Mar 2020 .
Operating Margins expanded 51.5 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 5.51 compared to Rs 6.3 for previous quarter ended Dec 2020 and Rs 2.45 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2418.0 cr for period ended Mar 2021 vis-vis sales of Rs 2395.0 cr for the period ended Mar 2020, a growth of 1.0%. The 3 year sales cagr stood at 10.4%.
Operating margins expanded to 17.0% for period ended Mar 2021 vis-vis 16.0% for period ended Mar 2020, expansion of 100.0 bps.
Net Profit reported at Rs 277.0 cr for period ended Mar 2021 vis-vis sales of Rs 229.0 cr for the period ended Mar 2020, rising 17.3%.
Company recorded a healthy Net Profit CAGR of 30.7% 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 377.0 cr for period ended Mar 2021 vis-vis Rs 60.0 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 17.0% compared to 17.0% over the last 3 Years. – The stock has given a return of 116% on a 1 Year basis vis-vis a return of 25% over the last 3 Years. – The compounded sales growth on a TTM bassis is 1% vis-vis a compounded sales growth of 10% over the last 3 Years. – The compounded profit growth on a TTM basis is 12% vis-vis a compounded profit growth of 31% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 19.78% vis-vis 19.46% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 21.75% vis-vis 23.11% for Mar 2021
Conclusion
– has reduced debt.
– has delivered good profit growth of 28.15% CAGR over last 5 years – The company has delivered a poor sales growth of 8.04% over past five 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 728.64 and is trading at 826.0, thus bullish price action wise.
