MM Forgings Ltd. (MMFL) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Frontier Springs

Rajratan Global

Wheels India

NRB Bearings

Uniparts India

MM Forgings

Federal-Mogul Go

Rane (Madras)

Divgi Torq

NDR Auto Compon.

Sundaram Clayton

Why is MM Forgings Ltd. ?

Healthy long term growth as Operating profit has grown by an annual rate 41.98%

The company has declared negative results for the last 6 consecutive quarters

PBT LESS OI(Q) At Rs 21.11 cr has Fallen at -33.2% (vs previous 4Q average)
PAT(Q) At Rs 16.57 cr has Fallen at -40.3% (vs previous 4Q average)
ROCE(HY) Lowest at 9.33%

With ROCE of 9.3, it has a Attractive valuation with a 1.5 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 -11.48%, its profits have fallen by -27.8%

Majority shareholders : Promoters

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -11.48% returns in the last 1 year, the stock has also underperformed BSE500 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to MM Forgings 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 MM Forgings for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

MM Forgings

-11.48%

-0.31

36.50%

Sensex

6.63%

0.59

11.31%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

20.17%

EBIT Growth (5y)

41.98%

EBIT to Interest (avg)

4.53

Debt to EBITDA (avg)

3.40

Net Debt to Equity (avg)

1.06

Sales to Capital Employed (avg)

0.88

Tax Ratio

27.29%

Dividend Payout Ratio

15.85%

Pledged Shares

Institutional Holding

10.29%

ROCE (avg)

12.47%

ROE (avg)

16.10%

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

2.09

EV to EBIT

16.36

EV to EBITDA

10.58

EV to Capital Employed

1.53

EV to Sales

1.96

PEG Ratio

Dividend Yield

1.00%

ROCE (Latest)

9.34%

ROE (Latest)

10.31%

Loading Valuation Snapshot...

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

Bearish

RSI

No Signal

Bollinger Bands

Mildly Bullish

Mildly Bearish

Moving Averages

Bullish (Daily)

KST

Bullish

Bearish

Dow Theory

Mildly Bearish

Mildly 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

3What is working for the Company

OPERATING CF(Y)

Highest at Rs 181.62 Cr

CASH AND CASH EQUIVALENTS(HY)

Highest at Rs 233.19 cr

-23What is not working for the Company

PBT LESS OI(Q)

At Rs 21.11 cr has Fallen at -33.2% (vs previous 4Q average

PAT(Q)

At Rs 16.57 cr has Fallen at -40.3% (vs previous 4Q average

ROCE(HY)

Lowest at 9.33%

DEBTORS TURNOVER RATIO(HY)

Lowest at 3.76 times

OPERATING PROFIT TO INTEREST (Q)

Lowest at 3.13 times

DEBT-EQUITY RATIO(HY)

Highest at 1.31 times

INTEREST(Q)

Highest at Rs 21.23 cr

EPS(Q)

Lowest at Rs 3.43

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Here's what is working for MM Forgings

Operating Cash Flow - Annually

Highest at Rs 181.62 Cr

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (Rs Cr)

Cash and Cash Equivalents - Half Yearly

Highest at Rs 233.19 cr

in the last six half yearly periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Here's what is not working for MM Forgings

Profit Before Tax less Other Income (PBT) - Quarterly

At Rs 21.11 cr has Fallen at -33.2% (vs previous 4Q average)

over average PBT of the previous four quarters of Rs 31.60 Cr

MOJO Watch

Near term PBT trend is very negative

PBT less Other Income (Rs Cr)

Profit After Tax (PAT) - Quarterly

At Rs 16.57 cr has Fallen at -40.3% (vs previous 4Q average)

over average PAT of the previous four quarters of Rs 27.74 Cr

MOJO Watch

Near term PAT trend is very negative

PAT (Rs Cr)

Operating Profit to Interest - Quarterly

Lowest at 3.13 times

in the last five quarters

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Debtors Turnover Ratio- Half Yearly

Lowest at 3.76 times and Fallen

each half year in the last five half yearly periods

MOJO Watch

Company's pace of settling its Debtors has slowed

Debtors Turnover Ratio

Interest - Quarterly

Highest at Rs 21.23 cr

in the last five quarters and Increased by 16.01 % (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (Rs cr)

Earnings per Share (EPS) - Quarterly

Lowest at Rs 3.43

in the last five quarters

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (Rs)

Debt-Equity Ratio - Half Yearly

Highest at 1.31 times

in the last five half yearly periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio