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Last Updated on: 17 October, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 501455 | NSE: GREAVESCOT

Greaves Cotton Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: October 16, 2024, 11:47 pm

Market Cap 4,492 Cr.
Current Price 193
High / Low195/112
Stock P/E
Book Value 62.1
Dividend Yield1.04 %
ROCE3.72 %
ROE1.62 %
Face Value 2.00
PEG Ratio0.00

Stock P/E, Current Price, and Intrinsic Value Over Time

View Share Price Target for Greaves Cotton Ltd

Competitors of Greaves Cotton Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Swaraj Engines Ltd 3,715 Cr. 3,0523,470/1,92726.5 3033.11 %51.6 %38.6 % 10.0
Kirloskar Oil Engines Ltd 17,474 Cr. 1,2041,450/49636.7 1850.50 %15.0 %17.7 % 2.00
Greaves Cotton Ltd 4,492 Cr. 193195/112 62.11.04 %3.72 %1.62 % 2.00
Cummins India Ltd 1,05,292 Cr. 3,7984,172/1,65959.6 2221.00 %35.2 %28.1 % 2.00
Industry Average32,743.25 Cr2,061.7540.93193.031.41%26.38%21.51%4.00

All Competitor Stocks of Greaves Cotton Ltd

Quarterly Result

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
Sales228.97373.51486.40620.82660.19698.81513.51826.94568.59726.69665.38672.53639.70
Expenses245.87383.70473.88581.55624.00657.18511.95779.78583.00680.79630.02648.79612.41
Operating Profit-16.90-10.1912.5239.2736.1941.631.5647.16-14.4145.9035.3623.7427.29
OPM %-7.38%-2.73%2.57%6.33%5.48%5.96%0.30%5.70%-2.53%6.32%5.31%3.53%4.27%
Other Income7.187.372.093.4010.9114.8117.1411.7822.44-365.0661.5810.9716.96
Interest0.761.211.202.176.072.102.371.151.712.212.273.042.94
Depreciation14.7314.9514.0814.9714.3314.0113.1415.2016.7319.1520.3328.1826.05
Profit before tax-25.21-18.98-0.6725.5326.7040.333.1942.59-10.41-340.5274.343.4915.26
Tax %-10.83%22.71%831.34%34.55%40.30%19.91%279.00%36.09%139.48%10.01%38.66%482.52%101.05%
Net Profit-22.48-23.29-6.2416.7115.9432.30-5.7127.22-24.93-374.5945.60-13.35-0.16
EPS in Rs-0.97-1.01-0.270.720.691.250.281.15-0.22-8.222.500.110.44

Last Updated: Unknown

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: Unknown

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024TTM
Sales1,9061,7361,6981,6161,6341,7922,0151,9111,5001,7102,6992,6332,704
Expenses1,6661,5931,5051,4131,3951,5371,7431,7011,4211,6852,5732,5432,572
Operating Profit241143192203240255272210802512791132
OPM %13%8%11%13%15%14%14%11%5%1%5%3%5%
Other Income1282-3113856932425-262055-270-276
Interest252111457512910
Depreciation41454846475252616059578494
Profit before tax211175111294249295240169-14-19113-273-247
Tax %30%30%25%32%27%32%32%25%36%83%38%34%
Net Profit14812384201181202163127-19-3570-367-342
EPS in Rs6.065.053.428.237.408.286.745.59-0.81-1.523.37-5.83-5.17
Dividend Payout %26%26%73%67%74%66%59%0%-25%-13%27%-34%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)-16.89%-31.71%139.29%-9.95%11.60%-19.31%-22.09%-114.96%-84.21%300.00%-624.29%
Change in YoY Net Profit Growth (%)0.00%-14.82%170.99%-149.24%21.55%-30.91%-2.78%-92.87%30.75%384.21%-924.29%

Greaves Cotton Ltd has shown an inconsistent trend in YoY Net Profit Growth (%) in the last 11 years from 2013-2014 to 2023-2024.

Growth

Compounded Sales Growth
10 Years:4%
5 Years:5%
3 Years:21%
TTM:4%
Compounded Profit Growth
10 Years:-14%
5 Years:-31%
3 Years:-11%
TTM:-144%
Stock Price CAGR
10 Years:4%
5 Years:9%
3 Years:11%
1 Year:44%
Return on Equity
10 Years:10%
5 Years:4%
3 Years:2%
Last Year:2%

Last Updated: Unknown

Balance Sheet

Last Updated: October 15, 2024, 3:42 pm

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Equity Capital494949494949494646464646
Reserves6847717748428769169207537367031,5401,394
Borrowings160-0-0-0-01128202572881
Other Liabilities4423833012863253814744134776291,103923
Total Liabilities1,1911,2031,1241,1771,2501,3461,4541,2401,2801,6352,7182,444
Fixed Assets373370326283292278339380372364369825
CWIP858241528726975828363
Investments921812933624115064203116123157
Other Assets7186474975075325356247888321,1742,1431,400
Total Assets1,1911,2031,1241,1771,2501,3461,4541,2401,2801,6352,7182,444

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity 108155225230114280145102147-56-135-153
Cash from Investing Activity -59-108-179-7036-9738255-108-238-758246
Cash from Financing Activity -78-55-60-166-148-162-174-241-20210889-32
Net Cash Flow-29-8-14-62201011619-84-461

Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow225.00143.00192.00203.00240.00255.00261.00182.0060.00-232.0099.0010.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days706850456051624951402233
Inventory Days505034384533355459564056
Days Payable65574668768286831201108278
Cash Conversion Cycle556137152921220-11-14-1910
Working Capital Days5053334439221826-379712
ROCE %30%21%21%28%23%23%24%18%3%-1%9%4%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthSep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
Promoters55.63%55.62%55.55%55.54%55.54%55.54%55.74%55.87%56.00%56.00%56.00%55.88%
FIIs3.81%3.84%3.13%3.47%3.90%4.15%4.54%4.94%4.57%3.18%2.81%1.15%
DIIs9.36%9.19%9.52%8.58%7.68%5.10%4.22%3.63%3.42%3.44%3.75%3.76%
Public31.20%31.35%31.79%32.41%32.86%35.20%35.50%35.56%35.99%37.36%37.43%39.18%
No. of Shareholders1,86,5231,92,7562,12,9332,21,5632,12,8322,17,7072,21,3272,18,6412,18,7312,11,6942,05,0422,12,801

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
L&T Focused Equity Fund1,605,9002.5724.281,605,9002024-10-130%
Sundaram Infrastructure Advantage Fund550,0000.919.671,605,9002024-10-13-65.75%
Motilal Oswal Nifty Microcap 250 Index Fund184,6650.243.251,605,9002024-10-13-88.5%
Taurus Flexi Cap Fund69,0930.311.221,605,9002024-10-13-95.7%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue2.002.002.002.002.00
Basic EPS (Rs.)-5.833.37-1.53-0.815.40
Diluted EPS (Rs.)-5.833.35-1.53-0.815.40
Cash EPS (Rs.)-12.155.751.121.808.14
Book Value[Excl.RevalReserv]/Share (Rs.)72.1684.9432.3733.8534.55
Book Value[Incl.RevalReserv]/Share (Rs.)72.1684.9432.3733.8534.55
Revenue From Operations / Share (Rs.)113.50116.5373.8564.9082.65
PBDIT / Share (Rs.)6.738.662.143.819.96
PBIT / Share (Rs.)3.106.21-0.391.197.32
PBT / Share (Rs.)-11.735.17-0.72-0.597.31
Net Profit / Share (Rs.)-15.793.31-1.42-0.815.50
NP After MI And SOA / Share (Rs.)-5.833.37-1.52-0.815.59
PBDIT Margin (%)5.937.422.895.8612.05
PBIT Margin (%)2.725.32-0.531.838.86
PBT Margin (%)-10.334.43-0.98-0.918.84
Net Profit Margin (%)-13.912.83-1.91-1.256.66
NP After MI And SOA Margin (%)-5.132.89-2.06-1.256.75
Return on Networth / Equity (%)-9.394.91-4.71-2.3916.17
Return on Capital Employeed (%)4.047.15-0.943.3319.96
Return On Assets (%)-5.482.86-2.14-1.4510.34
Long Term Debt / Equity (X)0.000.000.220.000.00
Total Debt / Equity (X)0.030.000.310.000.01
Asset Turnover Ratio (%)1.011.240.881.031.33
Current Ratio (X)1.722.301.531.561.78
Quick Ratio (X)1.321.991.241.181.30
Inventory Turnover Ratio (X)6.879.244.724.687.33
Dividend Payout Ratio (NP) (%)-15.435.93-13.080.000.00
Dividend Payout Ratio (CP) (%)-41.033.4319.710.000.00
Earning Retention Ratio (%)115.4394.07113.080.000.00
Cash Earning Retention Ratio (%)141.0396.5780.290.000.00
Interest Coverage Ratio (X)16.9317.159.2812.7045.42
Interest Coverage Ratio (Post Tax) (X)-2.428.62-4.713.2625.17
Enterprise Value (Cr.)2902.762768.384209.992677.971430.19
EV / Net Operating Revenue (X)1.101.032.461.780.74
EV / EBITDA (X)18.5813.8184.9630.426.21
MarketCap / Net Operating Revenue (X)1.111.082.581.970.84
Retention Ratios (%)115.4394.06113.080.000.00
Price / BV (X)2.041.845.903.782.02
Price / Net Operating Revenue (X)1.111.082.581.970.84
EarningsYield-0.040.02-0.01-0.010.08

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of Greaves Cotton Ltd as of October 16, 2024 is: ₹15.25

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

As of October 16, 2024, Greaves Cotton Ltd is Overvalued by 92.10% compared to the current share price ₹193.00

Default values used*: Default value of 15 for Stock P/E is used

Intrinsic Value of Greaves Cotton Ltd as of October 16, 2024 is: ₹10.90

Calculation basis:

  • Intrinsic value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the intrinsic value of the stock by analyzing its fundamental indicators along with EPS growth.

As of October 16, 2024, Greaves Cotton Ltd is Overvalued by 94.35% compared to the current share price ₹193.00

Default values used*: Default value of 15 for Stock P/E is used

Last 5 Year EPS CAGR: -28.52%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 16.92%, which is a positive sign.
  2. The company has higher reserves (909.08 cr) compared to borrowings (36.75 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (1.31 cr) and profit (100.31 cr) over the years.
  1. The stock has a high average Working Capital Days of 33.17, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 16.42, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in Greaves Cotton Ltd:
    1. Net Profit Margin: -13.91%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 4.04% (Industry Average ROCE: 26.38%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: -9.39% (Industry Average ROE: 21.51%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): -2.42
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 1.32
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 0 (Industry average Stock P/E: 40.93)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.03
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

Greaves Cotton Ltd. is a Public Limited Listed company incorporated on 29/03/1922 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L99999MH1922PLC000987 and registration number is 000987. Currently Company is involved in the business activities of Manufacture of power generators (except battery charging alternators for internal combustion engines), motor generator sets (except turbine generator set units). Company’s Total Operating Revenue is Rs. 1177.59 Cr. and Equity Capital is Rs. 46.30 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
EnginesJ-2, MIDC Industrial Area, Chikalthana, Aurangabad Maharashtra 431210investorservices@greavescotton.com
http://www.greavescotton.com
Management
NamePosition Held
Mr. Karan ThaparChairman
Mr. Nagesh BasavanhalliNon Executive Vice Chairman
Dr. Arup BasuManaging Director
Mr. Mangalath UnnikrishnanIndependent Director
Mr. Raja VenkataramanIndependent Director
Ms. Sree PatelIndependent Director
Mr. Ravi KirpalaniIndependent Director
Mr. Firdose VandrevalaIndependent Director

FAQ

What is the latest fair value of Greaves Cotton Ltd?

The latest fair value of Greaves Cotton Ltd is ₹15.25.

What is the Market Cap of Greaves Cotton Ltd?

The Market Cap of Greaves Cotton Ltd is 4,492 Cr..

What is the current Stock Price of Greaves Cotton Ltd as on 16 October 2024?

The current stock price of Greaves Cotton Ltd as on 16 October 2024 is ₹193.

What is the High / Low of Greaves Cotton Ltd stocks in FY 2024?

In FY 2024, the High / Low of Greaves Cotton Ltd stocks is 195/112.

What is the Stock P/E of Greaves Cotton Ltd?

The Stock P/E of Greaves Cotton Ltd is .

What is the Book Value of Greaves Cotton Ltd?

The Book Value of Greaves Cotton Ltd is 62.1.

What is the Dividend Yield of Greaves Cotton Ltd?

The Dividend Yield of Greaves Cotton Ltd is 1.04 %.

What is the ROCE of Greaves Cotton Ltd?

The ROCE of Greaves Cotton Ltd is 3.72 %.

What is the ROE of Greaves Cotton Ltd?

The ROE of Greaves Cotton Ltd is 1.62 %.

What is the Face Value of Greaves Cotton Ltd?

The Face Value of Greaves Cotton Ltd is 2.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in Greaves Cotton Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE