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Last Updated on: 17 November, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo

Precot Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: November 15, 2024, 2:05 pm

Market Cap 674 Cr.
Current Price 562
High / Low562/210
Stock P/E18.8
Book Value 363
Dividend Yield0.27 %
ROCE6.65 %
ROE2.92 %
Face Value 10.0
PEG Ratio0.20

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

View Share Price Target for Precot Ltd

Competitors of Precot Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Hisar Spinning Mills Ltd 24.7 Cr. 66.084.0/38.012.8 59.60.00 %12.5 %9.50 % 10.0
Rudra Ecovation Ltd 659 Cr. 62.882.6/22.21,569 7.740.00 %1.92 %4.05 % 1.00
H P Cotton Textile Mills Ltd 47.8 Cr. 122194/110 38.50.00 %4.39 %6.57 % 10.0
Gujarat Hy-Spin Ltd 28.9 Cr. 17.217.8/8.5027.2 11.20.00 %4.31 %0.90 % 10.0
Gem Spinners India Ltd 61.7 Cr. 10.010.6/3.27 0.310.00 %9.62 %% 5.00
Industry Average3,086.04 Cr197.3492.59131.040.33%35.08%10.57%7.41

All Competitor Stocks of Precot Ltd

Quarterly Result

MonthMar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Sales219174253282285253235227238224266228260
Expenses175140198225242218222248238217250210238
Operating Profit44345557433513-21-07161821
OPM %20%20%22%20%15%14%6%-9%-0%3%6%8%8%
Other Income2221211142-1213
Interest89858109981012810
Depreciation8888888987555
Profit before tax291941442919-4-37-13-7-1619
Tax %0%17%25%23%16%25%19%24%29%58%0%-36%37%
Net Profit291631342414-3-28-9-3-1912
EPS in Rs24.2113.3625.8028.5020.2111.62-2.61-23.28-7.42-2.58-0.907.3410.12

Last Updated: Unknown

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: Unknown

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Sales669738747684679709790726665993954978
Expenses592656725654650687732677571803924915
Operating Profit7782223029225949941903063
OPM %12%11%3%4%4%3%7%7%14%19%3%6%
Other Income111217-8254761166717
Interest273335394442424034303839
Depreciation303937383433313333333323
Profit before tax3121-32-56-24-6-8-1333134-3517
Tax %40%-48%-1%0%0%0%0%-28%0%21%25%3%
Net Profit1930-33-56-24-6-8-1733105-2617
EPS in Rs15.6025.37-27.20-46.27-19.69-4.81-6.89-13.7727.4687.85-21.6813.98
Dividend Payout %0%8%0%0%0%0%0%0%0%7%0%11%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)57.89%-210.00%-69.70%57.14%75.00%-33.33%-112.50%294.12%218.18%-124.76%165.38%
Change in YoY Net Profit Growth (%)0.00%-267.89%140.30%126.84%17.86%-108.33%-79.17%406.62%-75.94%-342.94%290.15%

Precot 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:3%
5 Years:4%
3 Years:14%
TTM:2%
Compounded Profit Growth
10 Years:-6%
5 Years:28%
3 Years:-28%
TTM:191%
Stock Price CAGR
10 Years:24%
5 Years:88%
3 Years:23%
1 Year:156%
Return on Equity
10 Years:-3%
5 Years:6%
3 Years:7%
Last Year:3%

Last Updated: Unknown

Balance Sheet

Last Updated: November 14, 2024, 7:50 pm

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024Sep 2024
Equity Capital8121212121212121212121212
Reserves13114812266337331324298330432394406424
Borrowings439448383399352380354308329360379373351
Other Liabilities69865670110101971138712912216382
Total Liabilities647694573547811824787732758933907954869
Fixed Assets209364336314557533512470444433447449448
CWIP164011512133235667
Investments233016161617181111129159
Other Assets250299220216233272255249301456447434345
Total Assets647694573547811824787732758933907954869

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity +2935912920117561265649121
Cash from Investing Activity +-146-2011-7673-1513-16-64-31-70
Cash from Financing Activity +119-22-104-23-87-17-68-82-171-23-50
Net Cash Flow3-7-2-10-3-8-8-7-7-51

Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow-362.00-366.00-361.00-369.00-323.00-358.00-295.00-259.00-235.00-170.00-349.00-310.00

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 Days232120252638374556514549
Inventory Days15517176124131127103106134180142137
Days Payable122013202029223830293761
Cash Conversion Cycle16617283129137135117112159203150125
Working Capital Days708043413890616711612011595
ROCE %10%8%-2%-1%2%-1%5%4%10%22%0%7%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Promoters61.50%61.50%61.50%61.50%61.50%61.51%61.51%61.51%61.51%61.51%61.51%61.51%
FIIs0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.27%
DIIs0.01%0.01%0.11%0.07%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Public38.49%38.49%38.38%38.42%38.49%38.49%38.49%38.49%38.49%38.49%38.49%38.23%
No. of Shareholders5,7436,3875,8886,0636,1056,2746,3856,3576,1916,3356,4005,721

Shareholding Pattern Chart

No. of Shareholders

This stock is not held by any mutual fund

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue10.0010.0010.0010.0010.00
Basic EPS (Rs.)13.99-21.6987.8527.46-13.77
Diluted EPS (Rs.)13.99-21.6987.8527.46-13.77
Cash EPS (Rs.)32.886.14114.9555.1013.51
Book Value[Excl.RevalReserv]/Share (Rs.)348.51338.09370.10284.68258.47
Book Value[Incl.RevalReserv]/Share (Rs.)348.51338.09370.10284.68258.47
Revenue From Operations / Share (Rs.)814.80794.85827.73554.28605.10
PBDIT / Share (Rs.)60.9129.18162.7182.3749.14
PBIT / Share (Rs.)42.011.34135.6054.7221.86
PBT / Share (Rs.)14.41-28.77111.4627.46-10.80
Net Profit / Share (Rs.)13.98-21.6887.8527.46-13.77
NP After MI And SOA / Share (Rs.)13.98-21.6887.8527.46-13.77
PBDIT Margin (%)7.473.6719.6514.868.12
PBIT Margin (%)5.150.1616.389.873.61
PBT Margin (%)1.76-3.6113.464.95-1.78
Net Profit Margin (%)1.71-2.7210.614.95-2.27
NP After MI And SOA Margin (%)1.71-2.7210.614.95-2.27
Return on Networth / Equity (%)4.01-6.4123.739.64-5.32
Return on Capital Employeed (%)8.670.2829.3613.985.72
Return On Assets (%)1.75-2.8711.294.32-2.25
Long Term Debt / Equity (X)0.340.350.180.300.38
Total Debt / Equity (X)0.880.930.800.800.95
Asset Turnover Ratio (%)1.051.041.190.900.97
Current Ratio (X)1.131.231.160.990.87
Quick Ratio (X)0.500.500.510.540.42
Inventory Turnover Ratio (X)2.392.682.862.673.23
Dividend Payout Ratio (NP) (%)0.00-27.660.000.000.00
Dividend Payout Ratio (CP) (%)0.0097.620.000.000.00
Earning Retention Ratio (%)0.00127.660.000.000.00
Cash Earning Retention Ratio (%)0.002.380.000.000.00
Interest Coverage Ratio (X)1.860.966.743.021.50
Interest Coverage Ratio (Post Tax) (X)1.270.274.642.010.57
Enterprise Value (Cr.)504.50514.76490.53408.23431.48
EV / Net Operating Revenue (X)0.510.530.490.610.59
EV / EBITDA (X)6.9014.702.514.137.32
MarketCap / Net Operating Revenue (X)0.140.150.140.210.19
Retention Ratios (%)0.00127.660.000.000.00
Price / BV (X)0.340.350.320.410.46
Price / Net Operating Revenue (X)0.140.150.140.210.19
EarningsYield0.11-0.180.730.22-0.11

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of Precot Ltd as of November 17, 2024 is: 199.81

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 November 17, 2024, Precot Ltd is Overvalued by 64.45% compared to the current share price 562.00

Intrinsic Value of Precot Ltd as of November 17, 2024 is: 391.15

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 November 17, 2024, Precot Ltd is Overvalued by 30.40% compared to the current share price 562.00

Last 5 Year EPS CAGR: 95.76%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The company has shown consistent growth in sales (777.67 cr) and profit (5.17 cr) over the years.
  1. The stock has a low average ROCE of 5.33%, which may not be favorable.
  2. The stock has a high average Working Capital Days of 78.00, which may not be favorable.
  3. The stock has a high average Cash Conversion Cycle of 140.67, which may not be favorable.
  4. The company has higher borrowings (373.46) compared to reserves (287.92), which may suggest financial risk.

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 Precot Ltd:
    1. Net Profit Margin: 1.71%
      • 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: 8.67% (Industry Average ROCE: 35.08%)
      • 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%: 4.01% (Industry Average ROE: 10.57%)
      • 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): 1.27
      • 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: 0.5
      • 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: 18.8 (Industry average Stock P/E: 92.59)
      • 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: 0.88
      • 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

Precot Ltd. is a Public Limited Listed company incorporated on 02/06/1962 and has its registered office in the State of Tamil Nadu, India. Company’s Corporate Identification Number(CIN) is L17111TZ1962PLC001183 and registration number is 001183. Currently Company is involved in the business activities of Preparation and spinning of cotton fiber including blended* cotton. Company’s Total Operating Revenue is Rs. 993.28 Cr. and Equity Capital is Rs. 12.00 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
Textiles - Spinning - Cotton BlendedSF No. 559/4, D Block, 4th Floor, Hanudev Info Park, Coimbatore Tamil Nadu 641028secretary@precot.com
http://www.precot.com
Management
NamePosition Held
Mr. Ashwin ChandranChairman & Managing Director
Mr. Prashanth ChandranVice Chairman & Mng.Director
Mr. T KumarExecutive Director
Mr. C N SrivatsanDirector
Mrs. R BhuvaneshwariDirector
Mr. P Vijay RaghunathDirector
Mr. Arun SelvarajDirector
Mr. Vinay Balaji NaiduDirector

FAQ

What is the latest intrinsic value of Precot Ltd?

The latest intrinsic value of Precot Ltd as on 17 November 2024 is ₹199.81, which is 64.45% lower than the current market price of ₹562.00.

What is the Market Cap of Precot Ltd?

The Market Cap of Precot Ltd is 674 Cr..

What is the current Stock Price of Precot Ltd as on 17 November 2024?

The current stock price of Precot Ltd as on 17 November 2024 is ₹562.

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

In FY 2024, the High / Low of Precot Ltd stocks is 562/210.

What is the Stock P/E of Precot Ltd?

The Stock P/E of Precot Ltd is 18.8.

What is the Book Value of Precot Ltd?

The Book Value of Precot Ltd is 363.

What is the Dividend Yield of Precot Ltd?

The Dividend Yield of Precot Ltd is 0.27 %.

What is the ROCE of Precot Ltd?

The ROCE of Precot Ltd is 6.65 %.

What is the ROE of Precot Ltd?

The ROE of Precot Ltd is 2.92 %.

What is the Face Value of Precot Ltd?

The Face Value of Precot Ltd is 10.0.

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 Precot 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