Our 6th company in the Series of Best Stocks to Buy in India for Short term 2021 is Equitas Holdings Ltd.
This company is good for investing purpose or not ?
Let’s start with the Company profile
Company Profile :
Equitas Holdings is engaged in providing micro finance, housing loan and vehicle finance.
Now Let’s check the important fundamental figures of this company. This is a small cap company with Market Cap ₹4,236cr. We can check more fundamental details below in depth:
Company Fundamental Detail :
PE Ratio: 8.95
Sector PE Ratio: 27.34
PE Ratio of this company is low but better than Sector’s PE. So it’s a Good PE than the peers of this company.
PB Ratio : 1.15
Sector PB Ratio : 2.33
PB Ratio of this company is low than Sector’s PB ratio. So it’s Good PB than the peers of this company.
Dividend Yield : 2.42%
Sector Dividend Yield : 0.53%
Dividend Yield of this company is high than Sector. Dividend of this company is Good than the peers of this company.
ROE: 12.9%
ROCE: n/a
ROE (Return on equity) and ROCE (Return on capital equity) is Below Average
According to above data, this company is looking fundamentally average. Now We’ll check the company Financially data:
Company Financial Detail
| Year | Revenue(cr.) | Profit(cr.) |
| 2021 | 3,820.69 | 473.24 |
| 2020 | 2,923.36 | 204.61 |
| 2019 | 2,358.53 | 176.59 |
| 2018 | 1,779.68 | 13.68 |
You can see the company growth clearly in the above table, in 2019 Net profit was 176.59 Cr. only and in 2020, It increased to 204.61 Cr. and in 2021, it is increased to 473.24 Cr.
We should check now liabilities of company also in the below table
Total Current & Non Current Liabilities
| 2021 | 2020 | 2019 | 2018 |
| 21,909.98 | 17,931.00 | 13,271.23 | 11,197.01 |
Liabilities of a company refers to the debt of that company. We should also aware the debt of company. In 2021 , Company have 21,909.98 Cr. debt.
Let’s check the Free Cash flow of the company
Free Cash flow
| 2021 | 2020 | 2019 | 2018 |
| 2,690.44 | -1,047.84 | 1,639.06 | 388.29 |
Debt Level: Equitas Holdings Ltd debt to equity ratio (140.6%) is considered high.
Reducing Debt: Equitas Holdings Ltd debt to equity ratio has reduced from 348% to 140.6% over the past 5 years.
Debt Coverage: Equitas Holdings Ltd debt is well covered by operating cash flow (53.1%).
Interest Coverage: Insufficient data to determine if Equitas Holdings Ltd interest payments on its debt are well covered by EBIT.
Share Holding Pattern
| Promotor Holding | Foreign Institution | Mutual Fund | Other Domestic Institutions | Retail & Others | |
| Jun 2021 | 0.00% | 28.90% | 29.78% | 1.12% | 40.20% |
| Mar 2021 | 0.00% | 28.38% | 30.65% | 2.58% | 38.40% |
| Dec 2020 | 0.00% | 25.59% | 29.23% | 1.19% | 43.99% |
| Sep 2020 | 0.00% | 20.73% | 30.60% | 2.08% | 46.59% |
Above table showing Mutual Fund which is 29.78% in June 2021. FIIs invested in June 2021 with 28.90% and retail investor is 40.20%.
Now We’ll check the return of the company, This company started from Rs. 141.85 at 27 April 2016. This company given 134.98% returns in last 1 year from 2020 to 9 Sep 2021.
Investment Checklist for Equitas Holdings Ltd.
- The company is currently profitable
- Has a high level of debt
- Unstable dividend track record
- Volatile share price over the past 3 months
- Earnings are forecast to grow by an average of 29.2% per year for the next 3 years
- The company’s earnings are high quality
- Profit margins improved or Equitas Holdings Ltd became profitable
- They have sufficient analyst coverage
- No concerning events detected
- Shareholders have not been meaningfully diluted in the past year or recently listed
- Revenue is meaningful (₹21B)
- Market cap is meaningful (₹42B)
- Equitas Holdings Ltd does not have negative shareholders equity.
According to its historical performance we can predict stock target.
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Entry Buying Zone : Premium members can see only
Target: Premium members can see only
Time Horizon:Premium members can see only
Risk Profile: Premium members can see only
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Entry Buying Zone : 110 to 115
Target: 160 (40% Upside)
Time Horizon: 1 Year
Risk Profile: Low Risk (Stock is 1.88x as volatile as Nifty)
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Hope you liked Our 6th company in the Series of Best stocks to buy in India for short term 2021. We tried to cover many important things about this company, if you think anything left to cover, you can comment us and we’ll try to cover those things also.
Disclaimer: This is an Educational Initiative and is NOT registered under any SEBI regulations. All the information that we provide is just for Educational purposes and you should consult your financial adviser before taking any investment decision. Also we do NOT provide any form of Stock Tips or Advise on stocks or portfolios. My All Trades Only Education Purpose. All trades will be at your risk. You have the responsibility of any trade or any benefit or loss