Mehabe score: 4 G Factor: 6 Piotski Score: 5 The stock has a rating 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 6 and Piotski score of 5.
Description
NR Agarwal Industries Ltd is in the business of manufacturing different kinds of duplex paper boards and writing and printing papers.
The company is among the first and leading manufacturers of recycled paper in India and the largest manufacturer of grey back and white back duplex board for over 2 decades. #
Main Points
Revenue Breakup
Presently, writing & printing paper accounts for ~54% of revenues and Duplex boards accounts for ~44% of revenues.# It forayed into writing and printing paper in 2014 only.#Site:NRAILMain Symbol:NRAGRINDQ
Stock trades at 252.0, above its 50dma 236.98. It also trades above its 200dma 225.93. The stock remains bullish on techicals
The 52 week high is at 284.00 and the 52week low is at 170.20
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
-Stock is trading at 0.90 times its book value
– has a good return on equity (ROE) track record: 3 Years ROE 25.00%
Weakness
– The company has delivered a poor sales growth of 5.34% over past five years.
-‘s cost of borrowing seems high
Competition
– The industry trades at a mean P/E of 25.8x. Century Textiles trades at the industry’s max P/E of 284.99x. NRAIL trades at a P/E of 7.5x
– Industry’s mean G-Factor is 4.9 while the mean Piotski score is 6.0. NRAIL has a G-Factor of 6 and Piotski scoreof 5.
– Average 1 month return for industry is 12.9%. The max 1- month return was given by Century Textiles: a return of 33.03 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 392.0 cr compared to Rs 203.0 cr for period ended Jun 2020, a rise of 93.1%
Operating Profits reported at Rs 49.0 cr for period ended Jun 2021 vis-vis 36.0 for period ended Jun 2020 .
Operating Margins contracted -523.4 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 15.27 compared to Rs 5.55 for previous quarter ended Mar 2021 and Rs 9.24 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1335.0 cr for period ended TTM vis-vis sales of Rs 1146.0 cr for the period ended Mar 2021, a healthy growth of 14.2%. The 3 year sales cagr stood at 0.4%.
Operating margins shrank to 11.0% for period ended TTM vis-vis 12.0% for period ended Mar 2021, contraction of 100.0 bps.
Net Profit reported at Rs 67.0 cr for period ended TTM vis-vis sales of Rs 57.0 cr for the period ended Mar 2021, rising 14.9%.
Company reported a poor Net Profit CAGR of -11.0% 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 worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was 13.0% compared to 25.0% over the last 3 Years. – The stock has given a return of 21% on a 1 Year basis vis-vis a return of -15% over the last 3 Years. – The compounded sales growth on a TTM bassis is -18% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is -51% vis-vis a compounded profit growth of -14% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 0.43% vis-vis 0.43% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 26.01% vis-vis 26.01% for Mar 2021
Conclusion
– has reduced debt.
-Stock is trading at 0.90 times its book value
– has a good return on equity (ROE) track record: 3 Years ROE 25.00% – The company has delivered a poor sales growth of 5.34% over past five years.
-‘s cost of borrowing seems high
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 236.98 and is trading at 252.0, thus bullish price action wise.
