Mehabe score: 1 G Factor: 1 Piotski Score: 6 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 1 and Piotski score of 6.
Description
Paisalo Digital is engaged in a systemically important non deposit taking non-banking finance company providing loans.(Source : 201903 Annual Report Page No: 108)Site:PAISALOMain Symbol:PAISALO
Stock trades at 588.0, below its 50dma 627.94 and below its 200dma 603.47. The stock remains bearish on technicals
The 52 week high is at 880.00 and the 52week low is at 346.00
Price Chart
P/E Chart
Sales and Margin
Strengths
–
Weakness
– Stock is trading at 2.88 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -3.14%
-The company has delivered a poor sales growth of 11.11% over past five years.
– has a low return on equity of 7.90% for last 3 years.
-Dividend payout has been low at 7.30% of profits over last 3 years
Competition
– The industry trades at a mean P/E of 20.1x. SBI Cards trades at the industry’s max P/E of 111.89x. PAISALO trades at a P/E of 39.9x
– Industry’s mean G-Factor is 2.5 while the mean Piotski score is 6.0. PAISALO has a G-Factor of 1 and Piotski scoreof 6.
– Average 1 month return for industry is 3.9%. The max 1- month return was given by Bajaj Finserv: a return of 17.59 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 92.0 cr compared to Rs 87.0 cr for period ended Jun 2020, a rise of 5.7%
Operating Profits reported at Rs 25.0 cr for period ended Jun 2021 vis-vis 25.0 for period ended Jun 2020 .
Operating Margins contracted -156.2 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 4.01 compared to Rs 0.48 for previous quarter ended Mar 2021 and Rs 3.56 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 351.0 cr for period ended TTM vis-vis sales of Rs 346.0 cr for the period ended Mar 2021, a growth of 1.4%. The 3 year sales cagr stood at -0.9%.
Operating margins expanded to 85.0% for period ended TTM vis-vis 84.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 63.0 cr for period ended TTM vis-vis sales of Rs 61.0 cr for the period ended Mar 2021, rising 3.2%.
Company recorded a Net Profit CAGR of 4.0% 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 7.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 34% on a 1 Year basis vis-vis a return of 25% over the last 3 Years. – The compounded sales growth on a TTM bassis is -5% vis-vis a compounded sales growth of 5% over the last 3 Years. – The compounded profit growth on a TTM basis is 17% vis-vis a compounded profit growth of 2% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has risen for the period ended Jun 2021. The Jun 2021 fii holding stood at 19.98% vis-vis 14.14% for Mar 2021 – Public shareholding has fallen for the period ended Jun 2021. The Jun 2021 public holding stood at 21.19% vis-vis 25.01% for Mar 2021
Conclusion
– – Stock is trading at 2.88 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -3.14%
-The company has delivered a poor sales growth of 11.11% over past five years.
– has a low return on equity of 7.90% for last 3 years.
-Dividend payout has been low at 7.30% of profits over last 3 years
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 627.94 and is trading at 588.0. 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
