Heranba Industries Quality Parameter Revision Highlights Business Fundamentals

Examining Heranba Industries’ financial metrics reveals a sales growth rate over five years of 15.56%, indicating a moderate expansion in top-line revenue. However, the company’s earnings before interest and tax (EBIT) growth over the same period shows a contraction of 84.14%, signalling challenges in operational profitability. The average EBIT to interest coverage ratio stands at 3.84, suggesting the company generates nearly four times its interest obligations from operating earnings, a figure that provides some cushion but warrants close monitoring.

Debt metrics for Heranba Industries show an average debt to EBITDA ratio of 2.36 and a net debt to equity ratio of 0.28. These figures suggest a moderate leverage position relative to earnings and equity base, which may influence the company’s financial flexibility. The sales to capital employed ratio averages 1.21, reflecting the efficiency with which the company utilises its capital to generate revenue. Taxation impacts are notable, with a tax ratio of 61.36%, while the dividend payout ratio exceeds 130%, indicating distributions surpassing net profits, a factor that could affect retained earnings and reinvestment capacity.

Return metrics provide further insight: the average ROCE is recorded at 7.85%, while the average ROE is 4.37%. These returns suggest modest capital and equity utilisation in generating profits. When compared to peers within the Pesticides & Agrochemicals industry, Heranba Industries is positioned below average in quality evaluation, with competitors such as Bayer CropScience and BASF India maintaining good grades, and others like Anupam Rasayan and Rallis India holding average standings.

Stock price movements reflect the underlying fundamentals and market sentiment. Heranba Industries’ current price is ₹265.00, with a 52-week high of ₹498.20 and a low of ₹205.20. Recent trading shows a day change of 0.17%, with intraday prices ranging between ₹263.00 and ₹270.00. The stock’s returns over various periods contrast sharply with the Sensex benchmark: a one-week return of -3.99% versus Sensex’s 0.96%, a one-month return of -11.8% against Sensex’s 0.86%, and a year-to-date return of -35.52% compared to Sensex’s 8.36%. Longer-term returns over one, three, five, and ten years also show negative or unavailable data for Heranba Industries, while Sensex posted positive gains, underscoring relative underperformance.

Institutional holding in Heranba Industries is minimal at 0.33%, and there are no pledged shares reported, which may be viewed favourably in terms of shareholding stability. The company’s dividend payout ratio exceeding 130% could indicate reliance on reserves or borrowings to maintain dividend levels, a factor that investors may wish to consider in assessing sustainability.

In summary, the revision in Heranba Industries’ quality parameter evaluation reflects a comprehensive assessment of its financial and operational metrics. The company’s moderate sales growth contrasts with significant contraction in EBIT, while leverage and return ratios suggest cautious capital utilisation. Relative to industry peers and market benchmarks, Heranba Industries exhibits below average quality parameters, which may influence investor considerations in the context of the broader Pesticides & Agrochemicals sector.

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