Mehabe score: 5 G Factor: 4 Piotski Score: 7 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 4 and Piotski score of 7.
Description
SKF India is leading supplier of products, solutions & services within rolling bearing, seals, mechatronics, and lubrication system.(Source : 202003 Annual Report Page No:132)Site:SKFINDIAMain Symbol:SKFINDIA
Stock trades at 2726.0, above its 50dma 2514.58. It also trades above its 200dma 2165.5. The stock remains bullish on techicals
The 52 week high is at 2939.00 and the 52week low is at 1426.55
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– has been maintaining a healthy dividend payout of 88.05%
Weakness
– Stock is trading at 8.62 times its book value
-The company has delivered a poor sales growth of -2.28% over past five years.
-Debtor days have increased from 66.13 to 79.74 days.
Competition
– The industry trades at a mean P/E of 38.0x. Vishal Bearings trades at the industry’s max P/E of 91.85x. SKFINDIA trades at a P/E of 45.4x
– Industry’s mean G-Factor is 2.8 while the mean Piotski score is 7.0. SKFINDIA has a G-Factor of 4 and Piotski scoreof 7.
– Average 1 month return for industry is 3.0%. The max 1- month return was given by Bimetal Bearings: a return of 18.24 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 694.0 cr compared to Rs 301.0 cr for period ended Jun 2020, a rise of 130.6%
Company reported operating profit of Rs 114.0 cr for period ended Jun 2021, operating profit margin at 16.4 %.
Operating profit was negative for the same period last year thus company has improved its margins this year
The EPS for Jun 2021 was Rs 16.0 compared to Rs 21.21 for previous quarter ended Mar 2021 and Rs -0.05 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 3063.0 cr for period ended TTM vis-vis sales of Rs 2671.0 cr for the period ended Mar 2021, a healthy growth of 12.8%. The 3 year sales cagr stood at 0.3%.
Operating margins expanded to 17.0% for period ended TTM vis-vis 16.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 377.0 cr for period ended TTM vis-vis sales of Rs 298.0 cr for the period ended Mar 2021, rising 21.0%.
Company recorded a Net Profit CAGR of 3.9% 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 had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 17.0% compared to 17.0% over the last 3 Years. – The stock has given a return of 73% on a 1 Year basis vis-vis a return of 18% over the last 3 Years. – The compounded sales growth on a TTM bassis is -6% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is 13% vis-vis a compounded profit growth of 0% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 5.11% vis-vis 5.31% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 14.42% vis-vis 12.92% for Mar 2021
Conclusion
– is almost debt free.
– has been maintaining a healthy dividend payout of 88.05% – Stock is trading at 8.62 times its book value
-The company has delivered a poor sales growth of -2.28% over past five years.
-Debtor days have increased from 66.13 to 79.74 days.
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 2514.58 and is trading at 2726.0, thus bullish price action wise.
