Mehabe score: 5 G Factor: 3 Piotski Score: 5 The stock has a rating OBSERVE & 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 3 and Piotski score of 5.
Description
RPSG Ventures owns, operates, invests & promotes business in the fields of Information Technology, Business Process Outsourcing, Property, Entertainment & Fast Moving Consumer Goods (FMCG).
Stock trades at 548.0, above its 50dma 416.49. It also trades above its 200dma 330.16. The stock remains bullish on techicals
The 52 week high is at 604.00 and the 52week low is at 162.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.62 times its book value
Weakness
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Competition
– The industry trades at a mean P/E of 33.3x. Happiest Minds trades at the industry’s max P/E of 83.56x. RPSGVENT trades at a P/E of 27.1x
– Industry’s mean G-Factor is 3.8 while the mean Piotski score is 9.0. RPSGVENT has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 16.1%. The max 1- month return was given by RPSG Ventures: a return of 42.48 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1659.0 cr compared to Rs 1213.0 cr for period ended Mar 2020, a rise of 36.8%
Operating Profits reported at Rs 256.0 cr for period ended Mar 2021 vis-vis 115.0 for period ended Mar 2020 .
Operating Margins expanded 595.0 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs -47.07 compared to Rs 6.45 for previous quarter ended Dec 2020 and Rs -2.87 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 5599.0 cr for period ended Mar 2021 vis-vis sales of Rs 4578.0 cr for the period ended Mar 2020, a healthy growth of 18.2%. The 3 year sales cagr stood at 41.1%.
Operating margins expanded to 13.0% for period ended Mar 2021 vis-vis 10.0% for period ended Mar 2020, expansion of 300.0 bps.
Net Profit reported at Rs -96.0 cr for period ended Mar 2021 vis-vis sales of Rs -3.0 cr for the period ended Mar 2020, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of 231% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 14% vis-vis a compounded sales growth of % over the last 3 Years. – The compounded profit growth on a TTM basis is 1576% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 13.33% vis-vis 13.29% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 33.38% vis-vis 31.95% for Dec 2020
Conclusion
– Stock is trading at 0.62 times its book value –
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 416.49 and is trading at 548.0 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
