Bharat Forge Ltd. (BHARATFORG) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Samvardh. Mothe.

ZF Commercial

Schaeffler India

Sona BLW Precis.

Bharat Forge

Tube Investments

Motherson Wiring

Bosch

Endurance Tech

Uno Minda

Exide Inds.

Why is Bharat Forge Ltd. ?

Healthy long term growth as Net Sales has grown by an annual rate of 21.90% and Operating profit at 170.84%

With ROCE of 13.3, it has a Fair valuation with a 6.8 Enterprise value to Capital Employed

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 78.59%, its profits have risen by 13.8% ; the PEG ratio of the company is 5.9

High Institutional Holdings at 46.92%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Market Beating performance in long term as well as near term

Along with generating 78.59% returns in the last 1 year, the stock has outperformed BSE500 in the last 3 years, 1 year and 3 months

With its market cap of Rs 95,190 cr, it is the biggest company in the sector and constitutes 50.88% of the entire sector

Its annual Sales of Rs 16,811.65 are 33.95% of the industry

Real-Time Research Report

Verdict Report

How much should you buy?

Overall Portfolio exposure to Bharat Forge should be less than 10%
Overall Portfolio exposure to Auto Components & Equipments should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Auto Components & Equipments)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Bharat Forge for you?

Medium Risk, High Return

Absolute

Risk Adjusted

Volatility

Bharat Forge

78.7%

2.62

30.01%

Sensex

-3.74%

-0.28

13.48%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

21.55%

EBIT Growth (5y)

50.95%

EBIT to Interest (avg)

5.07

Debt to EBITDA (avg)

3.08

Net Debt to Equity (avg)

0.54

Sales to Capital Employed (avg)

0.94

Tax Ratio

34.66%

Dividend Payout Ratio

44.06%

Pledged Shares

Institutional Holding

46.92%

ROCE (avg)

12.14%

ROE (avg)

12.50%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

9.92

EV to EBIT

51.23

EV to EBITDA

34.23

EV to Capital Employed

6.80

EV to Sales

5.96

PEG Ratio

5.86

Dividend Yield

0.40%

ROCE (Latest)

13.28%

ROE (Latest)

12.27%

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Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Mildly Bearish

Bullish

Dow Theory

Bullish

OBV

Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

8What is working for the Company

PAT(9M)

At Rs 892.08 cr has Grown at 20.25%

NET SALES(Q)

Highest at Rs 4,528.04 cr

PBDIT(Q)

Highest at Rs 778.20 cr.

PBT LESS OI(Q)

Highest at Rs 437.90 cr.

-3What is not working for the Company

DEBTORS TURNOVER RATIO(HY)

Lowest at 4.30 times

EPS(Q)

Lowest at Rs 4.86

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Here's what is working for Bharat Forge

Net Sales - Quarterly

Highest at Rs 4,528.04 cr and Grown

each quarter in the last five quarters

MOJO Watch

Near term sales trend is very positive

Net Sales (Rs Cr)

Profit After Tax (PAT) - Nine Monthly

At Rs 892.08 cr has Grown at 20.25%

Year on Year (YoY)

MOJO Watch

Near term PAT trend is positive

PAT (Rs Cr)

Operating Profit (PBDIT) - Quarterly

Highest at Rs 778.20 cr.

in the last five quarters

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (Rs Cr)

Profit Before Tax less Other Income (PBT) - Quarterly

Highest at Rs 437.90 cr.

in the last five quarters

MOJO Watch

Near term PBT trend is positive

PBT less Other Income (Rs Cr)

Here's what is not working for Bharat Forge

Earnings per Share (EPS) - Quarterly

Lowest at Rs 4.86

in the last five quarters

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (Rs)

Debtors Turnover Ratio- Half Yearly

Lowest at 4.30 times

in the last five half yearly periods

MOJO Watch

Company's pace of settling its Debtors has slowed

Debtors Turnover Ratio