Mehabe score: 4 G Factor: 6 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 6 and Piotski score of 7.
Description
CIL Nova Petrochemicals Limited is engaged in the preparation and spinning of man-made fiber, including blended man-made fibers and others.Site:CNOVAPETROMain Symbol:CNOVAPETRO
Stock trades at 25.2, above its 50dma 13.15. It also trades above its 200dma 9.32. The stock remains bullish on techicals
The 52 week high is at 32.60 and the 52week low is at 5.40
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.80 times its book value
– is expected to give good quarter
Weakness
– The company has delivered a poor sales growth of -5.09% over past five years.
– has a low return on equity of 0.56% for last 3 years.
-Contingent liabilities of Rs.20.74 Cr.
-Debtor days have increased from 71.08 to 87.20 days.
Competition
– The industry trades at a mean P/E of 7.3x. Grasim Inds trades at the industry’s max P/E of 19.86x. CNOVAPETRO trades at a P/E of 4.51x
– Industry’s mean G-Factor is 5.6 while the mean Piotski score is 7.0. CNOVAPETRO has a G-Factor of 6 and Piotski scoreof 7.
– Average 1 month return for industry is -6.0%. The max 1- month return was given by Grasim Inds: a return of 6.05 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 79.56 cr compared to Rs 13.69 cr for period ended Sep 2020, a rise of 481.2%
Company reported operating profit of Rs 4.98 cr for period ended Sep 2021, operating profit margin at 6.3 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Sep 2021 was Rs 1.11 compared to Rs 0.98 for previous quarter ended Jun 2021 and Rs -0.79 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 277.0 cr for period ended TTM vis-vis sales of Rs 154.0 cr for the period ended Mar 2021, a healthy growth of 44.4%. The 3 year sales cagr stood at 3.6%.
Net Profit reported at Rs 15.0 cr for period ended TTM vis-vis sales of Rs 5.0 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
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 7.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 300% on a 1 Year basis vis-vis a return of 3% over the last 3 Years. – The compounded sales growth on a TTM bassis is 151% vis-vis a compounded sales growth of -14% over the last 3 Years. – The compounded profit growth on a TTM basis is 381% vis-vis a compounded profit growth of 62% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has risen for the period ended Sep 2021. The Sep 2021 fii holding stood at 7.27% vis-vis 1.24% for Jun 2021 – Public shareholding has fallen for the period ended Sep 2021. The Sep 2021 public holding stood at 18.22% vis-vis 24.25% for Jun 2021
Conclusion
– Stock is trading at 0.80 times its book value
– is expected to give good quarter – The company has delivered a poor sales growth of -5.09% over past five years.
– has a low return on equity of 0.56% for last 3 years.
-Contingent liabilities of Rs.20.74 Cr.
-Debtor days have increased from 71.08 to 87.20 days.
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 13.15 and is trading at 25.2, thus bullish price action wise.
