Mehabe score: 3 G Factor: 2 Piotski Score: 9 The stock has a rating SELL. 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 2 and Piotski score of 9.
Description
Exxaro Tiles Ltd. (ETL) is engaged in the manufacturing of double charge vitrified tiles and glazed vitrified tiles used for flooring solutions. Its product basket consists of 1000+ designs and it is sold under its own brand “Exxaro”. The company has a PAN India presence with 2000+ registered dealers across 24 states/union territories[1] Site:EXXARO Main Symbol:EXXARO
Stock trades at 133.0, below its 50dma 142.72 and below its 200dma 140.98. The stock remains bearish on technicals
The 52 week high is at 172.70 and the 52week low is at 120.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Tax rate seems low
– has a low return on equity of 8.92% for last 3 years.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 31.2x. Kajaria Ceramics trades at the industry’s max P/E of 49.92x. EXXARO trades at a P/E of 39.0x
– Industry’s mean G-Factor is 2.3 while the mean Piotski score is 9.0. EXXARO has a G-Factor of 2 and Piotski scoreof 9.
– Average 1 month return for industry is -3.4%. The max 1- month return was given by Orient Bell: a return of 15.09 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 85.24 cr compared to Rs 60.98 cr for period ended Sep 2020, a rise of 39.8% .
vis-vis 11.26 for period ended Sep 2020 .
Operating Margins contracted -384.8 bps for period ended Dec 2021 vis-vis Sep 2020.
Company reported operating profit of Rs 12.46 cr for period ended Dec 2021 and operating profit margin at 14.6 % for same period.
The EPS for quarter ended Dec 2021 is Rs 1.29 compared to Rs 1.26 for previous quarter ended Sep 2021 and Rs 1.4 for Sep 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 255.0 cr for period ended Mar 2021 vis-vis sales of Rs 241.0 cr for the period ended Mar 2020, a growth of 5.5%. The 3 year sales cagr stood at 5.0%.
Operating margins expanded to 19.0% for period ended Mar 2021 vis-vis 18.0% for period ended Mar 2020, expansion of 100.0 bps.
Net Profit reported at Rs 15.0 cr for period ended Mar 2021 vis-vis sales of Rs 11.0 cr for the period ended Mar 2020, rising 26.7%.
Company reported a poor Net Profit CAGR of -5.9% 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 38.0 cr for period ended Mar 2021 vis-vis Rs 6.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of % on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 6% vis-vis a compounded sales growth of 5% over the last 3 Years. – The compounded profit growth on a TTM basis is 36% vis-vis a compounded profit growth of -5% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Dec 2021 fii holding stood at 4.19% vis-vis 4.33% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 48.89% vis-vis 48.75% for Sep 2021
Conclusion
– has reduced debt. – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-Tax rate seems low
– has a low return on equity of 8.92% for last 3 years.
-‘s cost of borrowing seems high
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 142.72 and is trading at 133.0. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
