Mehabe score: 4 G Factor: 3 Piotski Score: 8 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 8.
Description
MBL Infrastructures is engaged in execution of civil engineering projects with specialisation in roads & highways.Site:MBLINFRAMain Symbol:MBLINFRA
Stock trades at 23.0, below its 50dma 23.19. However it is trading above its 200dma 18.85. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 23.19.
The 52 week high is at 29.90 and the 52week low is at 5.97
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.29 times its book value
-Debtor days have improved from 148.39 to 91.16 days.
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -38.70% over past five years.
– has a low return on equity of 2.71% for last 3 years.
-Contingent liabilities of Rs.74.72 Cr.
– might be capitalizing the interest cost
-Earnings include an other income of Rs.128.96 Cr.
Competition
– The industry trades at a mean P/E of 35.1x. Macrotech Devel. trades at the industry’s max P/E of 365.15x. MBLINFRA trades at a P/E of 4.48x
– Industry’s mean G-Factor is 4.5 while the mean Piotski score is 8.0. MBLINFRA has a G-Factor of 3 and Piotski scoreof 8.
– Average 1 month return for industry is 26.3%. The max 1- month return was given by National Standar: a return of 153.35 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 31.73 cr compared to Rs 22.46 cr for period ended Jun 2020, a rise of 41.3%
Company reported negative operating profit of Rs -10.77 cr for period ended Jun 2021. For same period last year, operating profit was -14.04
The EPS for Jun 2021 was Rs 0.01 compared to Rs -5.54 for previous quarter ended Mar 2021 and Rs 0.13 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 212.0 cr for period ended TTM vis-vis sales of Rs 203.0 cr for the period ended Mar 2021, a growth of 4.2%. The 3 year sales cagr stood at 11.2%.
Operating margins expanded to -6.0% for period ended TTM vis-vis -8.0% for period ended Mar 2021, expansion of 200.0 bps.
Net Profit reported at Rs 62.0 cr for period ended TTM vis-vis sales of Rs 63.0 cr for the period ended Mar 2021, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 46.0 cr for period ended Mar 2021 vis-vis Rs -6.0 cr for period ended Mar 2020
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 7.0% compared to 3.0% over the last 3 Years. – The stock has given a return of 266% 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 -5% vis-vis a compounded sales growth of -26% over the last 3 Years. – The compounded profit growth on a TTM basis is 377% vis-vis a compounded profit growth of 33% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 1.04% vis-vis 1.03% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 30.47% vis-vis 30.48% for Mar 2021
Conclusion
– Stock is trading at 0.29 times its book value
-Debtor days have improved from 148.39 to 91.16 days. – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -38.70% over past five years.
– has a low return on equity of 2.71% for last 3 years.
-Contingent liabilities of Rs.74.72 Cr.
– might be capitalizing the interest cost
-Earnings include an other income of Rs.128.96 Cr.
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 23.19 and is trading at 23.0. 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
