Mehabe score: 4 G Factor: 2 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 2 and Piotski score of 6.
Description
Hind Rectifiers is engaged in the business of Manufacture of other electrical equipment and Manufacture of electrical motors, generators, transformers, and electricity distribution and control apparatus.Site:HIRECT
Market Cap:
Rs 280 cr
Price:
169.0
Trading pe:
42.8x
Book-value:
58.9/share
Div yield:
0.47 %
Earning yield:
5.07%
Face-value:
2.00/share
52week high:
180.20
52week low:
108.50
Technical Analysis
Stock trades at 169.0, above its 50dma 138.77. It also trades above its 200dma 138.42. The stock remains bullish on techicals
The 52 week high is at 180.20 and the 52week low is at 108.50
Price Chart
P/E Chart
Sales and Margin
Strengths
– has delivered good profit growth of 48.30% CAGR over last 5 years
Weakness
–
Competition
– The industry trades at a mean P/E of 41.5x. Amber Enterp. trades at the industry’s max P/E of 115.13x. HIRECT trades at a P/E of 42.8x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 7.0. HIRECT has a G-Factor of 2 and Piotski scoreof 6.
– Average 1 month return for industry is 9.5%. The max 1- month return was given by Hind Rectifiers: a return of 28.57 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 75.57 cr compared to Rs 77.89 cr for period ended Mar 2020, a fall of 3.0%
Operating Profits reported at Rs 4.18 cr for period ended Mar 2021 vis-vis 5.78 for period ended Mar 2020 .
Operating Margins contracted -188.9 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.51 compared to Rs 0.75 for previous quarter ended Dec 2020 and Rs 1.25 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 305.0 cr for period ended Mar 2021 vis-vis sales of Rs 300.0 cr for the period ended Mar 2020, a growth of 1.6%. The 3 year sales cagr stood at 34.3%.
Operating margins shrank to 6.0% for period ended Mar 2021 vis-vis 13.0% for period ended Mar 2020, contraction of 700.0 bps.
Net Profit reported at Rs 5.0 cr for period ended Mar 2021 vis-vis sales of Rs 18.0 cr for the period ended Mar 2020, falling 260.0%.
Company recorded a healthy Net Profit CAGR of 71.0% over the last 3 years
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 company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 21.0% compared to 14.0% over the last 3 Years. – The stock has given a return of 35% on a 1 Year basis vis-vis a return of 12% over the last 3 Years. – The compounded sales growth on a TTM bassis is 1% vis-vis a compounded sales growth of 39% over the last 3 Years. – The compounded profit growth on a TTM basis is -69% vis-vis a compounded profit growth of 204% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 57.73% vis-vis 57.73% for Dec 2020
Conclusion
– has delivered good profit growth of 48.30% CAGR over last 5 years –
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 138.77 and is trading at 169.0 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
