Mehabe score: 2 G Factor: 4 Piotski Score: 4 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 4 and Piotski score of 4.
Description
Techno Electric & Engineering Company Ltd. (TEECL) is one of India’s most important power-infrastructure companies. We are at the top of Engineering, Procurement and Construction (EPC), asset ownership and operations and maintenance services in the three industry segments of generation, transmission and distribution.Site:TECHNOE
Market Cap:
Rs 3,689 cr
Price:
335.0
Trading pe:
18.4x
Book-value:
134/share
Div yield:
1.79 %
Earning yield:
6.73%
Face-value:
2.00/share
52week high:
354.80
52week low:
170.00
Technical Analysis
Stock trades at 335.0, above its 50dma 319.82. It also trades above its 200dma 276.67. The stock remains bullish on techicals
The 52 week high is at 354.80 and the 52week low is at 170.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
Weakness
– has a low return on equity of 13.23% for last 3 years.
-Earnings include an other income of Rs.83.59 Cr.
– has high debtors of 235.67 days.
Competition
– The industry trades at a mean P/E of 12.1x. Techno Elec.Engg trades at the industry’s max P/E of 18.4x. TECHNOE trades at a P/E of 18.4x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 6.0. TECHNOE has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 12.8%. The max 1- month return was given by Reliance Infra.: a return of 44.75 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 215.0 cr compared to Rs 114.0 cr for period ended Mar 2020, a rise of 88.6%
Operating Profits reported at Rs 19.0 cr for period ended Mar 2021 vis-vis 6.0 for period ended Mar 2020 .
Operating Margins expanded 357.4 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 1.18 compared to Rs 5.15 for previous quarter ended Dec 2020 and Rs 0.29 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 889.0 cr for period ended Mar 2021 vis-vis sales of Rs 871.0 cr for the period ended Mar 2020, a growth of 2.0%. The 3 year sales cagr stood at -11.5%.
Operating margins shrank to 24.0% for period ended Mar 2021 vis-vis 25.0% for period ended Mar 2020, contraction of 100.0 bps.
Net Profit reported at Rs 200.0 cr for period ended Mar 2021 vis-vis sales of Rs 177.0 cr for the period ended Mar 2020, rising 11.5%.
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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 14.0% compared to 13.0% over the last 3 Years. – The stock has given a return of 76% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 2% vis-vis a compounded sales growth of -12% over the last 3 Years. – The compounded profit growth on a TTM basis is 13% vis-vis a compounded profit growth of 0% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 1.04% vis-vis 1.0% for Dec 2020 – Public shareholding has fallen for the period ended Mar 2021. The Mar 2021 public holding stood at 7.84% vis-vis 11.12% for Dec 2020
Conclusion
– is almost debt free. – has a low return on equity of 13.23% for last 3 years.
-Earnings include an other income of Rs.83.59 Cr.
– has high debtors of 235.67 days.
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 319.82 and is trading at 335.0 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
