Mehabe score: 1 G Factor: 4 Piotski Score: 2 The stock has a rating SELL. 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 2.
Description
TCNS Clothing Co. Ltd, incorporated in 1997 is a leading exclusive women’s ethnic/fusion apparel company providing fashion in a modern retail environment. It combines fashion and functionality according to the needs of contemporary Indian women need. #
Main Points
Milestones
In 2016, BYTA ASSOCIATES made the largest PE deal in the category with an investment of $140 million.
In 2018, it was the 1st in the category to be listed.Site:TCNSBRANDSMain Symbol:TCNSBRANDS
Stock trades at 542.0, below its 50dma 568.13. However it is trading above its 200dma 512.18. The stock remains weak in the short term due to near term bearish momentum. However overall bullish structure remains intact. Price action will further build up as it moves above its dma50, currently situated at 568.13.
The 52 week high is at 652.40 and the 52week low is at 350.00
Price Chart
P/E Chart
Sales and Margin
Strengths
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Weakness
– Stock is trading at 5.45 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 5.54% over past five years.
-Promoter holding is low: 32.31%
– has a low return on equity of 7.92% for last 3 years.
-Earnings include an other income of Rs.35.38 Cr.
-Debtor days have increased from 69.31 to 94.67 days.
Competition
– The industry trades at a mean P/E of 20.8x. Garware Tech. trades at the industry’s max P/E of 38.46x. TCNSBRANDS trades at a P/E of x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 9.0. TCNSBRANDS has a G-Factor of 4 and Piotski scoreof 2.
– Average 1 month return for industry is -4.8%. The max 1- month return was given by Trident: a return of 10.8 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 94.0 cr compared to Rs 32.0 cr for period ended Jun 2020, a rise of 193.8%
Company reported negative operating profit of Rs -23.0 cr for period ended Jun 2021. For same period last year, operating profit was -43.0
The EPS for Jun 2021 was Rs -5.86 compared to Rs 0.63 for previous quarter ended Mar 2021 and Rs -7.37 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 697.0 cr for period ended TTM vis-vis sales of Rs 636.0 cr for the period ended Mar 2021, a growth of 8.8%. The 3 year sales cagr stood at -15.3%.
Net Profit reported at Rs -47.0 cr for period ended TTM vis-vis sales of Rs -56.0 cr for the period ended Mar 2021, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -9.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 46% on a 1 Year basis vis-vis a return of -6% over the last 3 Years. – The compounded sales growth on a TTM bassis is -23% vis-vis a compounded sales growth of -14% over the last 3 Years. – The compounded profit growth on a TTM basis is -1402% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 17.84% vis-vis 19.52% for Mar 2021 – Public shareholding has remained largely constant. The Jun 2021 public holding stood at 43.94% vis-vis 43.81% for Mar 2021
Conclusion
– – Stock is trading at 5.45 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 5.54% over past five years.
-Promoter holding is low: 32.31%
– has a low return on equity of 7.92% for last 3 years.
-Earnings include an other income of Rs.35.38 Cr.
-Debtor days have increased from 69.31 to 94.67 days.
Fundamentally, the stock remains weak. The business fundamentals are on shaky ground. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock reflects the poor fundamentals. The stock remains below its 50 DMA 568.13 and is trading at 542.0. It has shown near term lack of bullish momentum. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
