Mehabe score: 7 G Factor: 4 Piotski Score: 7 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 7.
Description
Vardhman Holdings is principally engaged in lending and investing activities.Site:VHLMain Symbol:VHL
Stock trades at 3162.0, above its 50dma 3053.31. It also trades above its 200dma 2409.51. The stock remains bullish on techicals
The 52 week high is at 3820.55 and the 52week low is at 1202.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.44 times its book value
-Market value of investments Rs.2184.91 Cr. is more than the Market Cap Rs.1008.73 Cr.
Weakness
– The company has delivered a poor sales growth of 9.24% over past five years.
-Tax rate seems low
– has a low return on equity of 7.94% for last 3 years.
-Earnings include an other income of Rs.219.66 Cr.
-Dividend payout has been low at 0.67% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 22.4x. SBI Cards trades at the industry’s max P/E of 96.75x. VHL trades at a P/E of 4.36x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 7.0. VHL has a G-Factor of 4 and Piotski scoreof 7.
– Average 1 month return for industry is -0.6%. The max 1- month return was given by Muthoot Finance: a return of 5.59 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 14.0 cr compared to Rs 8.0 cr for period ended Sep 2020, a rise of 75.0%
Operating Profits reported at Rs 14.0 cr for period ended Sep 2021 vis-vis 8.0 for period ended Sep 2020 .
The EPS for Sep 2021 was Rs 430.24 compared to Rs 279.87 for previous quarter ended Jun 2021 and Rs 71.82 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 23.0 cr for period ended TTM vis-vis sales of Rs 20.0 cr for the period ended Mar 2021, a healthy growth of 13.0%. The 3 year sales cagr stood at 36.7%.
Net Profit reported at Rs 346.0 cr for period ended TTM vis-vis sales of Rs 130.0 cr for the period ended Mar 2021, rising 62.4%.
Company recorded a healthy Net Profit CAGR of 19.6% 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 82.0 cr for period ended Mar 2021 vis-vis Rs -95.0 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 6.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 145% on a 1 Year basis vis-vis a return of 11% over the last 3 Years. – The compounded sales growth on a TTM bassis is 23% vis-vis a compounded sales growth of -11% over the last 3 Years. – The compounded profit growth on a TTM basis is 105% vis-vis a compounded profit growth of -10% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 3.0% vis-vis 2.99% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 21.11% vis-vis 21.12% for Jun 2021
Conclusion
– is almost debt free.
-Stock is trading at 0.44 times its book value
-Market value of investments Rs.2184.91 Cr. is more than the Market Cap Rs.1008.73 Cr. – The company has delivered a poor sales growth of 9.24% over past five years.
-Tax rate seems low
– has a low return on equity of 7.94% for last 3 years.
-Earnings include an other income of Rs.219.66 Cr.
-Dividend payout has been low at 0.67% of profits over last 3 years
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 3053.31 and is trading at 3162.0, thus bullish price action wise.
