Mehabe score: 6 G Factor: 6 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 6 and Piotski score of 7.
Description
Sri Nachammai Cotton Mills the Company manufactures combed, carded and compact cotton hosiery and hank yarn of counts ranging from 10s to 80s which are used by manufacturers to convert the same into fabric or garments for dyeing and export. Site:SRINACHA Main Symbol:SRINACHA
Stock trades at 56.9, above its 50dma 51.13. It also trades above its 200dma 40.35. The stock remains bullish on techicals
The 52 week high is at 71.00 and the 52week low is at 10.90
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 1.07 times its book value
– is expected to give good quarter
-Debtor days have improved from 33.39 to 22.58 days.
Weakness
– The company has delivered a poor sales growth of 6.78% over past five years.
– has a low return on equity of -0.41% for last 3 years.
-Contingent liabilities of Rs.21.82 Cr.
Competition
– The industry trades at a mean P/E of 10.1x. Arvind Ltd trades at the industry’s max P/E of 17.29x. SRINACHA trades at a P/E of 5.87x
– Industry’s mean G-Factor is 4.1 while the mean Piotski score is 8.0. SRINACHA has a G-Factor of 6 and Piotski scoreof 7.
– Average 1 month return for industry is -1.7%. The max 1- month return was given by Ambika Cotton: a return of 16.75 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 61.62 cr compared to Rs 45.94 cr for period ended Dec 2020, a rise of 34.1% .
vis-vis 1.41 for period ended Dec 2020 .
Operating Margins expanded 364.9 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 4.14 cr for period ended Dec 2021 and operating profit margin at 6.7 % for same period.
The EPS for quarter ended Dec 2021 is Rs 5.3 compared to Rs 1.09 for previous quarter ended Sep 2021 and Rs 0.77 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 199.0 cr for period ended TTM vis-vis sales of Rs 158.0 cr for the period ended Mar 2021, a healthy growth of 20.6%. The 3 year sales cagr stood at 7.5%.
Operating margins expanded to 7.0% for period ended TTM vis-vis 4.0% for period ended Mar 2021, expansion of 300.0 bps.
Net Profit reported at Rs 6.0 cr for period ended TTM vis-vis sales of Rs 1.0 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 9.0 cr for period ended Mar 2021 vis-vis Rs 1.0 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 2.0% compared to 0.0% over the last 3 Years. – The stock has given a return of 302% on a 1 Year basis vis-vis a return of 52% over the last 3 Years. – The compounded sales growth on a TTM bassis is 33% vis-vis a compounded sales growth of 0% over the last 3 Years. – The compounded profit growth on a TTM basis is 252% vis-vis a compounded profit growth of -9% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Dec 2021 public holding stood at 44.58% vis-vis 44.58% for Sep 2021
Conclusion
– Stock is trading at 1.07 times its book value
– is expected to give good quarter
-Debtor days have improved from 33.39 to 22.58 days. – The company has delivered a poor sales growth of 6.78% over past five years.
– has a low return on equity of -0.41% for last 3 years.
-Contingent liabilities of Rs.21.82 Cr.
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 51.13 and is trading at 56.9, thus bullish price action wise.
