Kelani Cables Ltd. (KCAB.N0000) 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

Kelani Cables Ltd.

Why is Kelani Cables Ltd. ?

Strong Long Term Fundamental Strength with an average Return on Equity (ROE) of 20.26%

Healthy long term growth as Operating profit has grown by an annual rate 67.98%
Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 10.11

With ROE of 17.36%, it has a very attractive valuation with a 1.61 Price to Book Value

Over the past year, while the stock has generated a return of 68.55%, its profits have risen by 38%

Market Beating Performance

The stock has generated a return of 68.55% in the last 1 year, much higher than market (Sri Lanka CSE All Share) returns of 11.95%

Real-Time Research Report

Verdict Report

How much should you buy?

Overall Portfolio exposure to Kelani Cables Ltd. should be less than 10%
Overall Portfolio exposure to Electronics & Appliances should be less than 30%

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

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

Is Kelani Cables Ltd. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

Kelani Cables Ltd.

68.55%

-0.63

105.36%

Sri Lanka CSE All Share

11.95%

0.72

16.49%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

19.04%

EBIT Growth (5y)

67.98%

EBIT to Interest (avg)

56.01

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.54

Sales to Capital Employed (avg)

1.28

Tax Ratio

27.55%

Dividend Payout Ratio

14.21%

Pledged Shares

Institutional Holding

ROCE (avg)

40.75%

ROE (avg)

20.26%

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

1.61

EV to EBIT

5.64

EV to EBITDA

5.47

EV to Capital Employed

2.31

EV to Sales

0.80

PEG Ratio

Dividend Yield

0.01%

ROCE (Latest)

40.86%

ROE (Latest)

17.36%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Mildly Bullish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bearish

No Trend

OBV

No Trend

Mildly Bearish

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

3What is working for the Company

CASH AND EQV(HY)

Highest at LKR 15,823.33 MM

DEBTORS TURNOVER RATIO(HY)

Highest at 6.91 times

NET PROFIT(Q)

Highest at LKR 660.82 MM

-5What is not working for the Company

INTEREST(Q)

At LKR 7.77 MM has Grown at 80.06%

RAW MATERIAL COST(Y)

Grown by 16.61% (YoY

OPERATING PROFIT(Q)

Lowest at LKR 678.12 MM

OPERATING PROFIT MARGIN(Q)

Lowest at 13.47 %

Here's what is working for Kelani Cables Ltd.

Net Profit

Highest at LKR 660.82 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is positive

Net Profit (LKR MM)

Cash and Eqv

Highest at LKR 15,823.33 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Debtors Turnover Ratio

Highest at 6.91 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Here's what is not working for Kelani Cables Ltd.

Interest

At LKR 7.77 MM has Grown at 80.06%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (LKR MM)

Operating Profit

Lowest at LKR 678.12 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (LKR MM)

Operating Profit Margin

Lowest at 13.47 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Raw Material Cost

Grown by 16.61% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has deteriorated; this may lead to a fall in profit margin

Raw Material Cost as a percentage of Sales

Non Operating Income

Highest at LKR 0.28 MM

in the last five periods

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating income