Mehabe score: 3 G Factor: 4 Piotski Score: 3 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 4 and Piotski score of 3.
Description
Power Mech Projects Limited operates as an engineering and construction company, which provides erection, testing and commissioning (ETC), civil and operation and maintenance services for power projects.Site:POWERMECH
Market Cap:
Rs 1,040 cr
Price:
707.0
Trading pe:
x
Book-value:
589/share
Div yield:
0.14 %
Earning yield:
0.49%
Face-value:
10.0/share
52week high:
743.35
52week low:
353.50
Technical Analysis
Stock trades at 707.0, above its 50dma 615.11. It also trades above its 200dma 530.03. The stock remains bullish on techicals
The 52 week high is at 743.35 and the 52week low is at 353.50
Price Chart
P/E Chart
Sales and Margin
Strengths
– ‘s median sales growth is 15.67% of last 10 years
Weakness
– has low interest coverage ratio.
-Contingent liabilities of Rs.671.78 Cr.
-Earnings include an other income of Rs.17.59 Cr.
-Debtor days have increased from 75.64 to 91.34 days.
Competition
– The industry trades at a mean P/E of 11.2x. Power Mech Proj. trades at the industry’s max P/E of 12.15x. POWERMECH trades at a P/E of x
– Industry’s mean G-Factor is 2.8 while the mean Piotski score is 8.0. POWERMECH has a G-Factor of 4 and Piotski scoreof 3.
– Average 1 month return for industry is 5.6%. The max 1- month return was given by Sanghvi Movers: a return of 21.43 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 755.0 cr compared to Rs 595.0 cr for period ended Mar 2020, a rise of 26.9%
Operating Profits reported at Rs 75.0 cr for period ended Mar 2021 vis-vis 65.0 for period ended Mar 2020 .
Operating Margins contracted -99.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 24.24 compared to Rs 2.13 for previous quarter ended Dec 2020 and Rs 21.31 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 1884.0 cr for period ended Mar 2021 vis-vis sales of Rs 2165.0 cr for the period ended Mar 2020, a fall of 14.9%. The 3 year sales cagr stood at 6.8%.
Operating margins shrank to 2.0% for period ended Mar 2021 vis-vis 13.0% for period ended Mar 2020, contraction of 1100.0 bps.
Net Profit reported at Rs -46.0 cr for period ended Mar 2021 vis-vis sales of Rs 131.0 cr for the period ended Mar 2020, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities: Rs 0.0 cr for period ended Mar 2021 vis-vis Rs -48.0 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 15.0% compared to 14.0% over the last 3 Years. – The stock has given a return of 91% on a 1 Year basis vis-vis a return of -9% over the last 3 Years. – The compounded sales growth on a TTM bassis is -23% vis-vis a compounded sales growth of 17% over the last 3 Years. – The compounded profit growth on a TTM basis is -137% vis-vis a compounded profit growth of 27% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 2.94% vis-vis 2.7% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 24.61% vis-vis 24.38% for Dec 2020
Conclusion
– ‘s median sales growth is 15.67% of last 10 years – has low interest coverage ratio.
-Contingent liabilities of Rs.671.78 Cr.
-Earnings include an other income of Rs.17.59 Cr.
-Debtor days have increased from 75.64 to 91.34 days.
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 615.11 and is trading at 707.0 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
