Mehabe score: 2 G Factor: 2 Piotski Score: 5 The stock has a rating SELL. 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 2 and Piotski score of 5.
Description
Music Broadcast Limited is a subsidiary of Jagran Prakashan Ltd. It runs radio channel Radio City.
Being the first FM radio broadcaster in India and with 19 years of expertise in the radio industry, Radio City is the second largest operator today.
Main Points
Wide Reach
Music Broadcast currently has 39 stations across 12 states, comprising 62- of the country’s FM population. Radio City reaches out to over 69 million listeners in 34 cities covered by AZ Research 2019 #Site:RADIOCITYMain Symbol:RADIOCITY
Stock trades at 25.4, below its 50dma 25.55. However it is trading above its 200dma 23.82. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 25.55.
The 52 week high is at 29.65 and the 52week low is at 14.60
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -10.76% over past five years.
– has a low return on equity of 2.75% for last 3 years.
-Earnings include an other income of Rs.14.08 Cr.
– has high debtors of 221.05 days.
Competition
– The industry trades at a mean P/E of 24.1x. Saregama India trades at the industry’s max P/E of 47.43x. RADIOCITY trades at a P/E of x
– Industry’s mean G-Factor is 3.1 while the mean Piotski score is 8.0. RADIOCITY has a G-Factor of 2 and Piotski scoreof 5.
– Average 1 month return for industry is -1.9%. The max 1- month return was given by Saregama India: a return of 23.77 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 20.0 cr compared to Rs 14.0 cr for period ended Jun 2020, a rise of 42.9%
Company reported negative operating profit of Rs -13.0 cr for period ended Jun 2021. For same period last year, operating profit was -15.0
The EPS for Jun 2021 was Rs -0.37 compared to Rs -0.11 for previous quarter ended Mar 2021 and Rs -0.4 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 134.0 cr for period ended TTM vis-vis sales of Rs 128.0 cr for the period ended Mar 2021, a growth of 4.5%. The 3 year sales cagr stood at -25.6%.
Operating margins expanded to -7.0% for period ended TTM vis-vis -9.0% for period ended Mar 2021, expansion of 200.0 bps.
Net Profit reported at Rs -23.0 cr for period ended TTM vis-vis sales of Rs -24.0 cr for the period ended Mar 2021, 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -4.0% compared to 3.0% over the last 3 Years. – The stock has given a return of 58% on a 1 Year basis vis-vis a return of -19% over the last 3 Years. – The compounded sales growth on a TTM bassis is -31% vis-vis a compounded sales growth of -25% over the last 3 Years. – The compounded profit growth on a TTM basis is -494% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.15% vis-vis 0.14% for Mar 2021 – Public shareholding has risen for the period ended Jun 2021. The Jun 2021 public holding stood at 20.31% vis-vis 17.75% for Mar 2021
Conclusion
– is almost debt free. – has low interest coverage ratio.
-The company has delivered a poor sales growth of -10.76% over past five years.
– has a low return on equity of 2.75% for last 3 years.
-Earnings include an other income of Rs.14.08 Cr.
– has high debtors of 221.05 days.
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 25.55 and is trading at 25.4. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
