Mehabe score: 2 G Factor: 3 Piotski Score: 6 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 3 and Piotski score of 6.
Description
Hindustan Construction Company is principally engaged in the business of providing engineering and construction services.Site:HCC
Market Cap:
Rs 2,054 cr
Price:
13.6
Trading pe:
x
Book-value:
-5.02/share
Div yield:
0.00 %
Earning yield:
13.37%
Face-value:
1.00/share
52week high:
14.43
52week low:
4.60
Technical Analysis
Stock trades at 13.6, above its 50dma 10.11. It also trades above its 200dma 8.33. The stock remains bullish on techicals
The 52 week high is at 14.43 and the 52week low is at 4.60
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -0.69% over past five years.
-Promoter holding is low: 34.71%
-Contingent liabilities of Rs.6517.34 Cr.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 17.9x. Macrotech Devel. trades at the industry’s max P/E of 18.56x. HCC trades at a P/E of x
– Industry’s mean G-Factor is 4.2 while the mean Piotski score is 6.0. HCC has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 17.1%. The max 1- month return was given by JP Associates: a return of 78.21 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 2354.0 cr compared to Rs 2337.0 cr for period ended Mar 2020, a rise of 0.7%
Operating Profits reported at Rs 99.0 cr for period ended Mar 2021 vis-vis 239.0 for period ended Mar 2020 .
Operating Margins contracted -602.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 1.04 compared to Rs 0.78 for previous quarter ended Dec 2020 and Rs 2.06 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 8248.0 cr for period ended Mar 2021 vis-vis sales of Rs 9437.0 cr for the period ended Mar 2020, a fall of 14.4%. The 3 year sales cagr stood at -6.6%.
Operating margins shrank to 5.0% for period ended Mar 2021 vis-vis 8.0% for period ended Mar 2020, contraction of 300.0 bps.
Net Profit reported at Rs -610.0 cr for period ended Mar 2021 vis-vis sales of Rs 197.0 cr for the period ended Mar 2020, falling 0%.
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 stock has given a return of 142% on a 1 Year basis vis-vis a return of 7% over the last 3 Years. – The compounded sales growth on a TTM bassis is -13% vis-vis a compounded sales growth of -7% over the last 3 Years. – The compounded profit growth on a TTM basis is -547% vis-vis a compounded profit growth of 15% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 11.21% vis-vis 11.32% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 35.13% vis-vis 35.0% for Dec 2020
Conclusion
– – has low interest coverage ratio.
-The company has delivered a poor sales growth of -0.69% over past five years.
-Promoter holding is low: 34.71%
-Contingent liabilities of Rs.6517.34 Cr.
-‘s cost of borrowing seems high
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 10.11 and is trading at 13.6 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
