Mehabe score: 7 G Factor: 3 Piotski Score: 5 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 5.
Description
JSW Holdings Ltd is a core investment company (CIC) and is primarily engaged in the business of investing and financing.[1] Site:JSWHL Main Symbol:JSWHL
Stock trades at 4376.0, above its 50dma 4165.11. It also trades above its 200dma 4271.7. The stock remains bullish on techicals
The 52 week high is at 6000.05 and the 52week low is at 3400.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
-Stock is trading at 0.27 times its book value
– is expected to give good quarter
-Promoter holding has increased by 4.84% over last quarter.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 1.01% for last 3 years.
Competition
– The industry trades at a mean P/E of 26.5x. Bajaj Finance trades at the industry’s max P/E of 69.6x. JSWHL trades at a P/E of 37.3x
– Industry’s mean G-Factor is 3.4 while the mean Piotski score is 6.0. JSWHL has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is 0.8%. The max 1- month return was given by Cholaman.Inv.&Fn: a return of 25.82 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 17.0 cr compared to Rs 15.0 cr for period ended Dec 2020, a rise of 13.3% .
vis-vis 14.0 for period ended Dec 2020 .
Operating Margins contracted -509.8 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 15.0 cr for period ended Dec 2021 and operating profit margin at 88.2 % for same period.
The EPS for quarter ended Dec 2021 is Rs 10.04 compared to Rs 89.46 for previous quarter ended Sep 2021 and Rs 9.19 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 182.0 cr for period ended TTM vis-vis sales of Rs 93.0 cr for the period ended Mar 2021, a healthy growth of 48.9%. The 3 year sales cagr stood at 19.4%.
Operating margins expanded to 96.0% for period ended TTM vis-vis 95.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 131.0 cr for period ended TTM vis-vis sales of Rs 66.0 cr for the period ended Mar 2021, rising 49.6%.
Company recorded a healthy Net Profit CAGR of 14.2% over the last 3 years
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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 1.0% compared to 1.0% over the last 3 Years. – The stock has given a return of 17% on a 1 Year basis vis-vis a return of 17% over the last 3 Years. – The compounded sales growth on a TTM bassis is 108% vis-vis a compounded sales growth of 1% over the last 3 Years. – The compounded profit growth on a TTM basis is 103% vis-vis a compounded profit growth of -1% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has fallen for the period ended Dec 2021. The Dec 2021 fii holding stood at 22.36% vis-vis 26.89% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 11.27% vis-vis 11.34% for Sep 2021
Conclusion
– is almost debt free.
-Stock is trading at 0.27 times its book value
– is expected to give good quarter
-Promoter holding has increased by 4.84% over last quarter. – Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 1.01% for last 3 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 4165.11 and is trading at 4376.0 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
