Mehabe score: 5 G Factor: 7 Piotski Score: 8 The stock has a rating STRONG BUY. 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 7 and Piotski score of 8.
Description
Vedanta is engaged in the business of exploring, extracting and processing minerals and oil and gas. The Company engages in the exploration, production and sale of oil and gas, aluminium, copper, iron ore and power.Site:VEDLMain Symbol:VEDL
Stock trades at 272.0, above its 50dma 262.44. It also trades above its 200dma 211.15. The stock remains bullish on techicals
The 52 week high is at 296.30 and the 52week low is at 91.20
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– has been maintaining a healthy dividend payout of 35.98%
-Promoter holding has increased by 10.07% over last quarter.
Weakness
– The company has delivered a poor sales growth of 6.49% over past five years.
– has a low return on equity of 6.83% for last 3 years.
-Contingent liabilities of Rs.33325.00 Cr.
-Promoters have pledged 99.99% of their holding.
Competition
– The industry trades at a mean P/E of 25.0x. KIOCL trades at the industry’s max P/E of 53.41x. VEDL trades at a P/E of 8.4x
– Industry’s mean G-Factor is 5.9 while the mean Piotski score is 8.0. VEDL has a G-Factor of 7 and Piotski scoreof 8.
– Average 1 month return for industry is -0.7%. The max 1- month return was given by Maithan Alloys: a return of 10.63 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 28206.0 cr compared to Rs 19755.0 cr for period ended Mar 2020, a rise of 42.8%
Operating Profits reported at Rs 9037.0 cr for period ended Mar 2021 vis-vis 4552.0 for period ended Mar 2020 .
Operating Margins expanded 899.7 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 17.3 compared to Rs 8.87 for previous quarter ended Dec 2020 and Rs -33.68 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 88021.0 cr for period ended Mar 2021 vis-vis sales of Rs 84447.0 cr for the period ended Mar 2020, a growth of 4.1%. The 3 year sales cagr stood at -1.4%.
Operating margins expanded to 31.0% for period ended Mar 2021 vis-vis 24.0% for period ended Mar 2020, expansion of 700.0 bps.
Net Profit reported at Rs 11602.0 cr for period ended Mar 2021 vis-vis sales of Rs -6664.0 cr for the period ended Mar 2020, rising 157.4%.
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.
CashFlow from operating activities: Rs 23980.0 cr for period ended Mar 2021 vis-vis Rs 19298.0 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 improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 21.0% compared to 7.0% over the last 3 Years. – The stock has given a return of 150% on a 1 Year basis vis-vis a return of 10% over the last 3 Years. – The compounded sales growth on a TTM bassis is 4% vis-vis a compounded sales growth of -1% over the last 3 Years. – The compounded profit growth on a TTM basis is 281% vis-vis a compounded profit growth of 10% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 16.27% vis-vis 16.06% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 16.67% vis-vis 15.29% for Dec 2020
Conclusion
– has reduced debt.
– has been maintaining a healthy dividend payout of 35.98%
-Promoter holding has increased by 10.07% over last quarter. – The company has delivered a poor sales growth of 6.49% over past five years.
– has a low return on equity of 6.83% for last 3 years.
-Contingent liabilities of Rs.33325.00 Cr.
-Promoters have pledged 99.99% of their holding.
Fundamentally, the stock remains a Strong ‘BUY’ in our long term portoflio.
Technically too, the stock is a Strong ‘BUY’ in our long term portoflio.The stock remains above its 50 DMA 262.44 and is trading at 272.0
Thus, overall, we retain a STRONG BUY on the stock. Any dips can be used to build positions.
