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
Glenmark Life Sciences, a subsidiary of Glenmark Pharmaceuticals Ltd, is one of the leading developers and manufacturers of select high-value Active Pharmaceutical Ingredients. The company further operates in Contract Development and manufacturing operations to offer services to specialty Pharmaceutical companies.[1] Site:GLS Main Symbol:GLS
Stock trades at 567.0, below its 50dma 601.11 and below its 200dma 661.66. The stock remains bearish on technicals
The 52 week high is at 799.95 and the 52week low is at 563.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 99.61%
-Debtor days have improved from 152.03 to 119.95 days.
Weakness
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Competition
– The industry trades at a mean P/E of 25.7x. Biocon trades at the industry’s max P/E of 69.26x. GLS trades at a P/E of 19.8x
– Industry’s mean G-Factor is 2.0 while the mean Piotski score is 9.0. GLS has a G-Factor of 6 and Piotski scoreof 7.
– Average 1 month return for industry is -2.3%. The max 1- month return was given by Biocon: a return of 12.86 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 522.0 cr compared to Rs 500.0 cr for period ended Dec 2020, a rise of 4.4% .
vis-vis 155.0 for period ended Dec 2020 .
Operating Margins contracted -303.1 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 146.0 cr for period ended Dec 2021 and operating profit margin at 28.0 % for same period.
The EPS for quarter ended Dec 2021 is Rs 8.46 compared to Rs 9.4 for previous quarter ended Sep 2021 and Rs 476.3 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2076.0 cr for period ended TTM vis-vis sales of Rs 1885.0 cr for the period ended Mar 2021, a growth of 9.2%. The 3 year sales cagr stood at 32.8%.
Net Profit reported at Rs 424.0 cr for period ended TTM vis-vis sales of Rs 352.0 cr for the period ended Mar 2021, rising 17.0%.
Company recorded a healthy Net Profit CAGR of 29.3% 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 388.0 cr for period ended Mar 2021 vis-vis Rs 195.0 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 61.0% compared to 100.0% over the last 3 Years. – 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 23% vis-vis a compounded sales growth of 1861% over the last 3 Years. – The compounded profit growth on a TTM basis is 12% vis-vis a compounded profit growth of 836% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Dec 2021 fii holding stood at 8.32% vis-vis 8.03% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 8.36% vis-vis 8.67% for Sep 2021
Conclusion
– is almost debt free.
– has a good return on equity (ROE) track record: 3 Years ROE 99.61%
-Debtor days have improved from 152.03 to 119.95 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 below its 50 DMA 601.11 and is trading at 567.0. Shows a near term lack of buying interest.
