Mehabe score: 5 G Factor: 1 Piotski Score: 8 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 1 and Piotski score of 8.
Description
Vaishali Pharma is primarily engaged in the marketing of pharmaceutical products including active pharmaceutical ingredients.Site:VAISHALIMain Symbol:www.nseindia.com
Stock trades at 41.8, above its 50dma 40.87. It also trades above its 200dma 40.3. The stock remains bullish on techicals
The 52 week high is at 77.05 and the 52week low is at 28.35
Price Chart
P/E Chart
Sales and Margin
Strengths
– is expected to give good quarter
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -4.22% over past five years.
– has a low return on equity of 2.78% for last 3 years.
-Earnings include an other income of Rs.1.81 Cr.
– has high debtors of 452.89 days.
-Promoter holding has decreased over last 3 years: -6.21%
Competition
– The industry trades at a mean P/E of 51.4x. 3M India trades at the industry’s max P/E of 182.8x. VAISHALI trades at a P/E of 41.9x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 8.0. VAISHALI has a G-Factor of 1 and Piotski scoreof 8.
– Average 1 month return for industry is 2.5%. The max 1- month return was given by Rain Industries: a return of 35.22 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 8.27 cr compared to Rs 3.57 cr for period ended Jun 2020, a rise of 131.7%
Operating Profits reported at Rs 1.26 cr for period ended Jun 2021 vis-vis 0.01 for period ended Jun 2020 .
Operating Margins expanded 1495.6 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 0.77 compared to Rs -1.37 for previous quarter ended Mar 2021 and Rs 0.0 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 58.48 cr for period ended TTM vis-vis sales of Rs 53.78 cr for the period ended Mar 2021, a growth of 8.0%. The 3 year sales cagr stood at -8.0%.
Operating margins expanded to 6.67% for period ended TTM vis-vis 4.89% for period ended Mar 2021, expansion of 178.0 bps.
Net Profit reported at Rs 1.85 cr for period ended TTM vis-vis sales of Rs 1.05 cr for the period ended Mar 2021, rising 43.2%.
Company recorded a healthy Net Profit CAGR of 37.6% 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 company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 5.0% compared to 3.0% over the last 3 Years. – The stock has given a return of -10% on a 1 Year basis vis-vis a return of 7% over the last 3 Years. – The compounded sales growth on a TTM bassis is -11% vis-vis a compounded sales growth of -7% over the last 3 Years. – The compounded profit growth on a TTM basis is 3400% vis-vis a compounded profit growth of 9% over the last 3 Years.
Ratios
Conclusion
– is expected to give good quarter – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
-The company has delivered a poor sales growth of -4.22% over past five years.
– has a low return on equity of 2.78% for last 3 years.
-Earnings include an other income of Rs.1.81 Cr.
– has high debtors of 452.89 days.
-Promoter holding has decreased over last 3 years: -6.21%
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 40.87 and is trading at 41.8 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
