Mehabe score: 5 G Factor: 3 Piotski Score: 5 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 3 and Piotski score of 5.
Description
SBC Exports Ltd was incorporated in 2011. It is engaged in the Trading and Manufacturing of Garments, Manpower Supply Services & Tour Operator Services. Currently, co. has 70 distributors in India, receives an average of 75 new projects every year. Mr Govindji Gupta is the MD of the co. [1] [2] [3] Site:SBC Main Symbol:SBC
Stock trades at 160.0, above its 50dma 144.58. It also trades above its 200dma 88.0. The stock remains bullish on techicals
The 52 week high is at 208.10 and the 52week low is at 38.00
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 7.53 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 9.89% for last 3 years.
Competition
– The industry trades at a mean P/E of 42.2x. Adani Enterp. trades at the industry’s max P/E of 170.14x. SBC trades at a P/E of 92.0x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 8.0. SBC has a G-Factor of 3 and Piotski scoreof 5.
– Average 1 month return for industry is -4.4%. The max 1- month return was given by MMTC: a return of 18.96 %
Quarterly Results
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Company reported operating profit of Rs 3.62 cr for period ended Dec 2021 and operating profit margin at 6.5 % for same period.
The EPS for quarter ended Dec 2021 is Rs 2.88 compared to Rs 1.95 for previous quarter ended Sep 2021.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 192.0 cr for period ended Mar 2021 vis-vis sales of Rs 109.0 cr for the period ended Mar 2020, a healthy growth of 43.2%. The 3 year sales cagr stood at 44.2%.
Operating margins shrank to 2.0% for period ended Mar 2021 vis-vis 4.0% for period ended Mar 2020, contraction of 200.0 bps.
Net Profit reported at Rs 2.0 cr for period ended Mar 2021 vis-vis sales of Rs 1.0 cr for the period ended Mar 2020, rising 50.0%.
Company recorded a healthy Net Profit CAGR of 26.0% 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 9.0% compared to 10.0% over the last 3 Years. – The stock has given a return of 277% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is 76% vis-vis a compounded sales growth of 44% over the last 3 Years. – The compounded profit growth on a TTM basis is 39% vis-vis a compounded profit growth of 29% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Dec 2021 public holding stood at 31.74% vis-vis 31.94% for Sep 2021
Conclusion
– – Stock is trading at 7.53 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 9.89% for last 3 years.
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 144.58 and is trading at 160.0 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
