Mehabe score: 5 G Factor: 4 Piotski Score: 4 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 4 and Piotski score of 4.
Description
Hilton Metal Forging is engaged in the Business of manufacturing of iron and steel forging, recognized export house, presently catering to the needs of Oil and Gas, Refineries and pharmaceutical industries. Site:HILTON Main Symbol:HILTON
Stock trades at 25.4, above its 50dma 21.59. It also trades above its 200dma 16.24. The stock remains bullish on techicals
The 52 week high is at 29.15 and the 52week low is at 8.85
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.73 times its book value
– is expected to give good quarter
Weakness
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -2.20%
-The company has delivered a poor sales growth of -6.66% over past five years.
– has a low return on equity of -9.40% for last 3 years.
– might be capitalizing the interest cost
Competition
– The industry trades at a mean P/E of 23.0x. PTC Industries trades at the industry’s max P/E of 257.03x. HILTON trades at a P/E of x
– Industry’s mean G-Factor is 2.9 while the mean Piotski score is 7.0. HILTON has a G-Factor of 4 and Piotski scoreof 4.
– Average 1 month return for industry is 8.5%. The max 1- month return was given by Hilton Met.Forg.: a return of 24.15 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 25.13 cr compared to Rs 23.31 cr for period ended Dec 2020, a rise of 7.8% .
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Company reported operating profit of Rs 3.44 cr for period ended Dec 2021 and operating profit margin at 13.7 % for same periodOperating profit was negative for the same period last year. Company has improved its margins this year.
The EPS for quarter ended Dec 2021 is Rs 1.74 compared to Rs -3.01 for previous quarter ended Sep 2021 and Rs -6.73 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 65.36 cr for period ended TTM vis-vis sales of Rs 47.52 cr for the period ended Mar 2021, a healthy growth of 27.3%. The 3 year sales cagr stood at -13.4%.
Operating margins expanded to 3.06% for period ended TTM vis-vis -36.24% for period ended Mar 2021, expansion of 3930.0 bps.
Net Profit reported at Rs -5.99 cr for period ended TTM vis-vis sales of Rs -19.57 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -37.0% compared to -9.0% over the last 3 Years. – The stock has given a return of 84% 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 0% vis-vis a compounded sales growth of -21% over the last 3 Years. – The compounded profit growth on a TTM basis is -94% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has risen for the period ended Dec 2021. The Dec 2021 public holding stood at 50.65% vis-vis 48.45% for Sep 2021
Conclusion
– Stock is trading at 0.73 times its book value
– is expected to give good quarter – has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -2.20%
-The company has delivered a poor sales growth of -6.66% over past five years.
– has a low return on equity of -9.40% for last 3 years.
– might be capitalizing the interest cost
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 21.59 and is trading at 25.4 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
