Mehabe score: 3 G Factor: 4 Piotski Score: 3 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 4 and Piotski score of 3.
Description
SBI Cards & Payment Services is engaged in the business of issuing credit cards to consumers in India.(Source : 202003-01 Annual Report Page No:113)Site:SBICARDMain Symbol:SBICARD
Stock trades at 957.0, below its 50dma 995.18. However it is trading above its 200dma 938.72. 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 995.18.
The 52 week high is at 1149.00 and the 52week low is at 720.90
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 14.29 times its book value
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 27.1x. SBI Cards trades at the industry’s max P/E of 100.52x. SBICARD trades at a P/E of 101.0x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 6.0. SBICARD has a G-Factor of 4 and Piotski scoreof 3.
– Average 1 month return for industry is 2.4%. The max 1- month return was given by Bajaj Finserv: a return of 7.48 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 2362.0 cr compared to Rs 2154.0 cr for period ended Jun 2020, a rise of 9.7%
Operating Profits reported at Rs 1779.0 cr for period ended Jun 2021 vis-vis 1365.0 for period ended Jun 2020 .
Operating Margins expanded 1194.7 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 3.24 compared to Rs 1.87 for previous quarter ended Mar 2021 and Rs 4.19 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 9498.0 cr for period ended TTM vis-vis sales of Rs 9296.0 cr for the period ended Mar 2021, a growth of 2.1%. The 3 year sales cagr stood at 10.6%.
Operating margins shrank to 860.0% for period ended TTM vis-vis 1030.0% for period ended Mar 2021, contraction of 17000.0 bps.
Net Profit reported at Rs 896.0 cr for period ended TTM vis-vis sales of Rs 985.0 cr for the period ended Mar 2021, falling 9.9%.
Company recorded a Net Profit CAGR of 1.2% 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 692.0 cr for period ended Mar 2021 vis-vis Rs -4067.0 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 17.0% compared to 23.0% over the last 3 Years. – The stock has given a return of 29% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 1% vis-vis a compounded sales growth of 21% over the last 3 Years. – The compounded profit growth on a TTM basis is -31% vis-vis a compounded profit growth of 18% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has risen for the period ended Jun 2021. The Jun 2021 fii holding stood at 12.47% vis-vis 8.62% for Mar 2021 – Public shareholding has fallen for the period ended Jun 2021. The Jun 2021 public holding stood at 11.34% vis-vis 16.01% for Mar 2021
Conclusion
– – Stock is trading at 14.29 times its book value
– might be capitalizing the interest cost
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 995.18 and is trading at 957.0. 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
