Mehabe score: 3 G Factor: 5 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 5 and Piotski score of 4.
Description
Chaman Lal Setia Exports Limited (CLSE) was incorporated in Amritsar, Punjab in 1994 by Mr. Chaman Lal Setia and his sons. # It’s one of the oldest Rice Millers cum Exporters of Basmati rice of all varieties from India. #
The company is engaged in the business of milling and processing basmati rice. The company has been involved in export operations since 1982 and was recognized as an export house by the Ministry of Commerce in 1989, at present the company is a ‘Star Export House’.
Main Points
Products
It has the following products:
Regular Products:
Maharani Traditional Raw Basmati Rice
Maharani 1121 Basmati Parboiled (Sella) Rice
Maharani Rice Suitable For Diabetic People With Moderate G.i.Site:CLSELMain Symbol:CHAMANSEQ
Stock trades at 145.0, above its 50dma 135.42. It also trades above its 200dma 106.94. The stock remains bullish on techicals
The 52 week high is at 155.00 and the 52week low is at 74.50
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
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Competition
– The industry trades at a mean P/E of 51.6x. Hindustan Foods trades at the industry’s max P/E of 110.47x. CLSEL trades at a P/E of 10.2x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 8.0. CLSEL has a G-Factor of 5 and Piotski scoreof 4.
– Average 1 month return for industry is -0.9%. The max 1- month return was given by Dodla Dairy: a return of 4.98 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 237.0 cr compared to Rs 244.0 cr for period ended Jun 2020, a fall of 2.9%
Operating Profits reported at Rs 25.0 cr for period ended Jun 2021 vis-vis 36.0 for period ended Jun 2020 .
Operating Margins contracted -420.6 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 3.27 compared to Rs 4.13 for previous quarter ended Mar 2021 and Rs 4.83 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 844.0 cr for period ended TTM vis-vis sales of Rs 851.0 cr for the period ended Mar 2021, a fall of 0.8%. The 3 year sales cagr stood at 3.3%.
Operating margins shrank to 13.0% for period ended TTM vis-vis 14.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 74.0 cr for period ended TTM vis-vis sales of Rs 82.0 cr for the period ended Mar 2021, falling 10.8%.
Company recorded a healthy Net Profit CAGR of 29.6% 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 26.0% compared to 22.0% over the last 3 Years. – The stock has given a return of 54% 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 1% vis-vis a compounded sales growth of 4% over the last 3 Years. – The compounded profit growth on a TTM basis is 4% vis-vis a compounded profit growth of 26% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.04% vis-vis 0.04% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 26.1% vis-vis 26.0% for Mar 2021
Conclusion
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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 135.42 and is trading at 145.0 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
