Pakistan Paper Products Ltd. (PPP) 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

Pakistan Paper Products Ltd.

Security Papers Ltd.

Century Paper & Board Mills Ltd.

Why is Pakistan Paper Products Ltd. ?

Poor Management Efficiency with a low ROCE of 12.86%

The company has been able to generate a Return on Capital Employed (avg) of 12.86% signifying low profitability per unit of total capital (equity and debt)

Low ability to service debt as the company has a high Debt to EBITDA ratio of 1.24 times

Low ability to service debt as the company has a high Debt to EBITDA ratio of 1.24 times
The company has been able to generate a Return on Equity (avg) of 7.87% signifying low profitability per unit of shareholders funds

Weak Long Term Fundamental Strength with an average Return on Capital Employed (ROCE) of 12.86%

OPERATING CASH FLOW(Y) Highest at PKR 198.94 MM
INTEREST COVERAGE RATIO(Q) Highest at 898.49
NET SALES(Q) Highest at PKR 535.56

With ROE of 7.7, it has a expensive valuation with a 0.6 Price to Book Value

Over the past year, while the stock has generated a return of 0%, its profits have fallen by -22.5%

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Pakistan Paper Products Ltd. should be less than 10%
Overall Portfolio exposure to Media & Entertainment should be less than 30%

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

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

Is Pakistan Paper Products Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Pakistan Paper Products Ltd.

-100.0%

2.26

56.87%

Pakistan KSE 100 Share

26.26%

2.81

22.77%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

10.60%

EBIT Growth (5y)

20.70%

EBIT to Interest (avg)

4.76

Debt to EBITDA (avg)

1.24

Net Debt to Equity (avg)

0.14

Sales to Capital Employed (avg)

1.06

Tax Ratio

32.88%

Dividend Payout Ratio

32.67%

Pledged Shares

Institutional Holding

ROCE (avg)

12.86%

ROE (avg)

7.87%

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

0.69

EV to EBIT

6.50

EV to EBITDA

5.25

EV to Capital Employed

0.72

EV to Sales

0.80

PEG Ratio

Dividend Yield

5.96%

ROCE (Latest)

11.08%

ROE (Latest)

6.99%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

Bullish

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

No Trend

Mildly Bearish

OBV

Mildly 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

5What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -5.8% (YoY

CASH AND EQV(HY)

Highest at PKR 17.7 MM

INVENTORY TURNOVER RATIO(HY)

Highest at 4.56 times

NET PROFIT(Q)

At PKR 30.17 MM has Grown at 137.22%

-4What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at PKR 100.9 MM

INTEREST(Q)

At PKR 8.94 MM has Grown at 33.15%

Here's what is working for Pakistan Paper Products Ltd.

Net Profit

At PKR 30.17 MM has Grown at 137.22%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (PKR MM)

Cash and Eqv

Highest at PKR 17.7 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Inventory Turnover Ratio

Highest at 4.56 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Raw Material Cost

Fallen by -5.8% (YoY)

MOJO Watch

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

Raw Material Cost as a percentage of Sales

Here's what is not working for Pakistan Paper Products Ltd.

Interest

At PKR 8.94 MM has Grown at 33.15%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (PKR MM)

Operating Cash Flow

Lowest at PKR 100.9 MM

in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (PKR MM)