Mehabe score: 4 G Factor: 2 Piotski Score: 7 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 2 and Piotski score of 7.
Description
Surana Solar is engaged in the business of manufacturing of Solar Photovoltic (SPV) Modules, generation of Wind Power energy and trading of other solar related products. Site:SURANASOL Main Symbol:SURANASOL
Stock trades at 37.0, above its 50dma 25.71. It also trades above its 200dma 17.2. The stock remains bullish on techicals
The 52 week high is at 43.20 and the 52week low is at 8.20
Price Chart
P/E Chart
Sales and Margin
Strengths
– is expected to give good quarter
Weakness
– Stock is trading at 3.34 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of -25.41% over past five years.
– has a low return on equity of 0.66% for last 3 years.
-Debtor days have increased from 66.72 to 106.47 days.
Competition
– The industry trades at a mean P/E of 30.8x. Surana Solar trades at the industry’s max P/E of 552.46x. SURANASOL trades at a P/E of 552.0x
– Industry’s mean G-Factor is 2.5 while the mean Piotski score is 7.0. SURANASOL has a G-Factor of 2 and Piotski scoreof 7.
– Average 1 month return for industry is 13.1%. The max 1- month return was given by Surana Solar: a return of 103.65 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 2.62 cr compared to Rs 3.66 cr for period ended Dec 2020, a fall of 28.4%
.
vis-vis 1.31 for period ended Dec 2020 .
Operating Margins contracted -2625.0 bps for period ended Dec 2021 vis-vis Dec 2020.
Company reported operating profit of Rs 0.25 cr for period ended Dec 2021 and operating profit margin at 9.5 % for same period.
The EPS for quarter ended Dec 2021 is Rs 0.06 compared to Rs 0.03 for previous quarter ended Sep 2021 and Rs 0.02 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 31.76 cr for period ended TTM vis-vis sales of Rs 27.94 cr for the period ended Mar 2021, a healthy growth of 12.0%. The 3 year sales cagr stood at -2.9%.
Operating margins shrank to 14.04% for period ended TTM vis-vis 19.22% for period ended Mar 2021, contraction of 518.0 bps.
Net Profit reported at Rs 0.56 cr for period ended TTM vis-vis sales of Rs 0.21 cr for the period ended Mar 2021, rising 62.5%.
Company reported a poor Net Profit CAGR of -17.6% 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 stock has given a return of 243% on a 1 Year basis vis-vis a return of 65% over the last 3 Years. – The compounded sales growth on a TTM bassis is 58% vis-vis a compounded sales growth of -11% over the last 3 Years. – The compounded profit growth on a TTM basis is 6% vis-vis a compounded profit growth of -37% over the last 3 Years.
Ratios
Shareholding Pattern
– Public shareholding has remained largely constant. The Sep 2021 public holding stood at 29.62% vis-vis 29.93% for Jun 2021
Conclusion
– is expected to give good quarter – Stock is trading at 3.34 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
-The company has delivered a poor sales growth of -25.41% over past five years.
– has a low return on equity of 0.66% for last 3 years.
-Debtor days have increased from 66.72 to 106.47 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 25.71 and is trading at 37.0 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
