Mehabe score: 2 G Factor: 3 Piotski Score: 7 The stock has a rating SELL. 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 7.
Description
Kaveri Seed Company is engaged into research, production, processing and marketing of various high quality hybrid seeds.Site:KSCLMain Symbol:KSCL
Stock trades at 523.0, below its 50dma 621.06 and below its 200dma 615.8. The stock remains bearish on technicals
The 52 week high is at 816.65 and the 52week low is at 463.05
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
-Promoter holding has increased by 1.76% over last quarter.
Weakness
– The company has delivered a poor sales growth of 6.81% over past five years.
-Tax rate seems low
Competition
– The industry trades at a mean P/E of 26.7x. Affle India trades at the industry’s max P/E of 90.28x. KSCL trades at a P/E of 13.9x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 9.0. KSCL has a G-Factor of 3 and Piotski scoreof 7.
– Average 1 month return for industry is 3.4%. The max 1- month return was given by Century Plyboard: a return of 28.46 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 630.0 cr compared to Rs 719.0 cr for period ended Jun 2020, a fall of 12.4%
Operating Profits reported at Rs 200.0 cr for period ended Jun 2021 vis-vis 287.0 for period ended Jun 2020 .
Operating Margins contracted -817.1 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 33.77 compared to Rs -2.88 for previous quarter ended Mar 2021 and Rs 48.95 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 947.0 cr for period ended TTM vis-vis sales of Rs 1033.0 cr for the period ended Mar 2021, a fall of 9.1%. The 3 year sales cagr stood at 5.4%.
Operating margins shrank to 22.0% for period ended TTM vis-vis 29.0% for period ended Mar 2021, contraction of 700.0 bps.
Net Profit reported at Rs 219.0 cr for period ended TTM vis-vis sales of Rs 310.0 cr for the period ended Mar 2021, falling 41.6%.
Company recorded a Net Profit CAGR of 0.3% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 252.0 cr for period ended Mar 2021 vis-vis Rs 192.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The stock has given a return of 3% on a 1 Year basis vis-vis a return of 0% over the last 3 Years. – The compounded sales growth on a TTM bassis is -7% vis-vis a compounded sales growth of 8% over the last 3 Years. – The compounded profit growth on a TTM basis is -33% vis-vis a compounded profit growth of 11% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Sep 2021 fii holding stood at 13.41% vis-vis 14.92% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 16.99% vis-vis 17.11% for Jun 2021
Conclusion
– has reduced debt.
– is almost debt free.
-Promoter holding has increased by 1.76% over last quarter. – The company has delivered a poor sales growth of 6.81% over past five years.
-Tax rate seems low
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 621.06 and is trading at 523.0. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
