Mehabe score: 6 G Factor: 5 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 5 and Piotski score of 7.
Description
Established in 1991, DCM commenced its spinning operations at its manufacturing plant in Hisar. DCM Nouvelle is leading manufacturer & exporter of 100% cotton carded and combed yarns . Site:DCMNVL Main Symbol:DCMNVL
Stock trades at 386.0, above its 50dma 293.01. It also trades above its 200dma 212.55. The stock remains bullish on techicals
The 52 week high is at 386.10 and the 52week low is at 61.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is expected to give good quarter
Weakness
– Stock is trading at 2.83 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– might be capitalizing the interest cost
-Debtor days have increased from 43.97 to 60.36 days.
Competition
– The industry trades at a mean P/E of 10.3x. Arvind Ltd trades at the industry’s max P/E of 25.72x. DCMNVL trades at a P/E of 6.71x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 8.0. DCMNVL has a G-Factor of 5 and Piotski scoreof 7.
– Average 1 month return for industry is 17.2%. The max 1- month return was given by DCM Nouvelle: a return of 38.83 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 231.0 cr compared to Rs 152.0 cr for period ended Dec 2020, a rise of 52.0% .
vis-vis 21.0 for period ended Dec 2020 .
Operating Margins expanded 479.9 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 43.0 cr for period ended Dec 2021 and operating profit margin at 18.6 % for same period.
The EPS for quarter ended Dec 2021 is Rs 16.51 compared to Rs 22.16 for previous quarter ended Sep 2021 and Rs 6.56 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 847.0 cr for period ended TTM vis-vis sales of Rs 563.0 cr for the period ended Mar 2021, a healthy growth of 33.5%. The 3 year sales cagr stood at 8.2%.
Operating margins expanded to 21.0% for period ended TTM vis-vis 11.0% for period ended Mar 2021, expansion of 1000.0 bps.
Net Profit reported at Rs 126.0 cr for period ended TTM vis-vis sales of Rs 31.0 cr for the period ended Mar 2021, rising 75.4%.
Company recorded a healthy Net Profit CAGR of 47.8% over the last 3 years
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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 18.0% compared to 19.0% over the last 3 Years. – The stock has given a return of 463% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 49% vis-vis a compounded sales growth of % over the last 3 Years. – The compounded profit growth on a TTM basis is 9604% vis-vis a compounded profit growth of 1351% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Dec 2021 fii holding stood at 0.89% vis-vis 0.21% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 42.5% vis-vis 43.11% for Sep 2021
Conclusion
– has reduced debt.
– is expected to give good quarter – Stock is trading at 2.83 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– might be capitalizing the interest cost
-Debtor days have increased from 43.97 to 60.36 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 293.01 and is trading at 386.0, thus bullish price action wise.
