Mehabe score: 2 G Factor: 2 Piotski Score: 7 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 7.
Description
Kakatiya Cement Sugar & Industries activities are organized into three operating divisions namely Cement, Sugar and Power. The major activity of the company is to produce, manufacture, refine, sell and generally to deal in all kinds of Portland Cement, sugar, generation and distribution of power.Site:KAKATCEM
Market Cap:
Rs 230 cr
Price:
296.0
Trading pe:
51.5x
Book-value:
288/share
Div yield:
1.01 %
Earning yield:
13.81%
Face-value:
10.0/share
52week high:
319.90
52week low:
133.50
Technical Analysis
Stock trades at 296.0, above its 50dma 236.3. It also trades above its 200dma 193.08. The stock remains bullish on techicals
The 52 week high is at 319.90 and the 52week low is at 133.50
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
-Stock is trading at 1.03 times its book value
Weakness
– The company has delivered a poor sales growth of 0.24% over past five years.
-Tax rate seems low
– has a low return on equity of 3.02% for last 3 years.
Competition
– The industry trades at a mean P/E of 18.9x. Kakatiya Cement trades at the industry’s max P/E of 51.47x. KAKATCEM trades at a P/E of 51.5x
– Industry’s mean G-Factor is 4.8 while the mean Piotski score is 8.0. KAKATCEM has a G-Factor of 2 and Piotski scoreof 7.
– Average 1 month return for industry is 12.8%. The max 1- month return was given by Sagar Cements: a return of 31.79 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 27.06 cr compared to Rs 24.72 cr for period ended Mar 2020, a rise of 9.5%
Company reported operating profit of Rs 3.06 cr for period ended Mar 2021, operating profit margin at 11.3 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Mar 2021 was Rs -2.55 compared to Rs -3.99 for previous quarter ended Dec 2020 and Rs -7.23 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 123.0 cr for period ended Mar 2021 vis-vis sales of Rs 156.0 cr for the period ended Mar 2020, a fall of 26.8%. The 3 year sales cagr stood at -7.8%.
Net Profit reported at Rs 1.0 cr for period ended Mar 2021 vis-vis sales of Rs -1.0 cr for the period ended Mar 2020, rising 200.0%.
Company reported a poor Net Profit CAGR of -53.6% 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 2.0% compared to 3.0% over the last 3 Years. – The stock has given a return of 112% on a 1 Year basis vis-vis a return of 5% over the last 3 Years. – The compounded sales growth on a TTM bassis is -27% vis-vis a compounded sales growth of -11% over the last 3 Years. – The compounded profit growth on a TTM basis is -62% vis-vis a compounded profit growth of -47% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Mar 2021 public holding stood at 45.74% vis-vis 45.9% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free.
-Stock is trading at 1.03 times its book value – The company has delivered a poor sales growth of 0.24% over past five years.
-Tax rate seems low
– has a low return on equity of 3.02% 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 236.3 and is trading at 296.0 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
