Mehabe score: 3 G Factor: 4 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 4 and Piotski score of 6.
Description
SPL Industries is a leading Apparel Export House in India, it is one of the largest vertically integrated Knitwear plants in India, the company is a leading manufacturer & exporter of Knitted fabric and Knitted garments SPLIL designs, manufactures, and sells a wide range of outerwear – T-shirts, sweatshirts, polo shirts, etc. for top-end customers in the international market.
Main Points
Revenue Mix (61% Exports)
Exports: 61% of the Revenue
Domestic: 2% of the Revenue
Processing charges: 34% of the Revenue#Site:SPLIL
Market Cap:
Rs 141 cr
Price:
48.6
Trading pe:
7.74x
Book-value:
47.0/share
Div yield:
0.00 %
Earning yield:
25.19%
Face-value:
10.0/share
52week high:
57.85
52week low:
23.00
Technical Analysis
Stock trades at 48.6, above its 50dma 41.54. It also trades above its 200dma 36.18. The stock remains bullish on techicals
The 52 week high is at 57.85 and the 52week low is at 23.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 1.03 times its book value
– has delivered good profit growth of 122.84% CAGR over last 5 years
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
-Tax rate seems low
-Earnings include an other income of Rs.8.78 Cr.
Competition
– The industry trades at a mean P/E of 22.6x. Garware Tech. trades at the industry’s max P/E of 38.67x. SPLIL trades at a P/E of 7.74x
– Industry’s mean G-Factor is 3.8 while the mean Piotski score is 8.0. SPLIL has a G-Factor of 4 and Piotski scoreof 6.
– Average 1 month return for industry is 12.5%. The max 1- month return was given by PDS Multi.: a return of 35.59 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 26.62 cr compared to Rs 33.29 cr for period ended Mar 2020, a fall of 20.0%
Operating Profits reported at Rs 2.79 cr for period ended Mar 2021 vis-vis 2.86 for period ended Mar 2020 .
Operating Margins expanded 189.0 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.92 compared to Rs 1.18 for previous quarter ended Dec 2020 and Rs 2.52 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 110.0 cr for period ended Mar 2021 vis-vis sales of Rs 177.0 cr for the period ended Mar 2020, a fall of 60.9%. The 3 year sales cagr stood at -14.0%.
Operating margins shrank to 14.0% for period ended Mar 2021 vis-vis 15.0% for period ended Mar 2020, contraction of 100.0 bps.
Net Profit reported at Rs 14.0 cr for period ended Mar 2021 vis-vis sales of Rs 31.0 cr for the period ended Mar 2020, falling 121.4%.
Company recorded a healthy Net Profit CAGR of 40.9% over the last 3 years
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 company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 28.0% compared to 24.0% over the last 3 Years. – The stock has given a return of 93% 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 -37% vis-vis a compounded sales growth of 6% over the last 3 Years. – The compounded profit growth on a TTM basis is -37% vis-vis a compounded profit growth of 179% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 0.0% vis-vis 0.0% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 31.05% vis-vis 31.05% for Dec 2020
Conclusion
– is almost debt free.
-Stock is trading at 1.03 times its book value
– has delivered good profit growth of 122.84% CAGR over last 5 years – Though the company is reporting repeated profits, it is not paying out dividend
-Tax rate seems low
-Earnings include an other income of Rs.8.78 Cr.
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 41.54 and is trading at 48.6, thus bullish price action wise.
