BHANSALI ENGINEERING SHARE: TARGET ACHIEVED!!!

“The stock market is a device for transferring money from the impatient to the patient”-Warren Buffet. 

Amazing quote shared by a great investor which truly signifies the stock we are about to discuss today.  

Let’s do a root cause analysis related to Bhansali Engineering share and try to understand how did it achieve the target we had predicted. 

By the way, the share had zoomed till ₹ 222 which is target achievement of 21% in a span of 10 trading sessions. 

How did the business of Bhansali Engineering share grow for achieving the desired target? 

Bhansali Engineering (BEPL) has a tremendous client base which are diversified in different sectors such as automobiles, home appliances, kitchenware and electronic healthcare. 

The main advantage of the company is that it is debt free and can use its cashflow for generating more revenue through business expansion. 

The company did approve the Brown Field ABS expansion project at existing plants i.e., Abu Road (Rajasthan) & Satnoor (Madhya Pradesh). 

The main intention of the company is to enhance the overall ABS production capacity to 2,00,000 tonnes per annum with a capex of ₹ 500 Cr. 

For the financial year 2021-22, the company also declared an Interim dividend for its shareholder in the month of Oct 2021. 

Let’s check how did Bhansali Engineering share perform financially. 

QUARTERLY RESULTS:     

Figures in Rs. Crores 

Quarterly Results Sep 2019 Dec 2019 Mar 2020 Jun 2020 Sep 2020 Dec 2020 Mar 2021 Jun 2021 Sep 2021 
Sales  280 260 251 99 308 411 473 232 375 
Expenses  260 236 239 103 262 227 254 131 211 
Operating Profit 20 25 13 -3 46 184 219 101 164 
OPM % 0.07 0.09 0.05 -0.03 0.15 0.45 0.46 0.43 0.44 
Other Income 
Interest 
Depreciation 
Profit before tax 17 23 10 -1 46 183 219 103 165 
Tax % -0.17 0.26 0.25 -0.07 0.22 0.26 0.25 0.25 0.25 
Net Profit 20 17 -1 36 136 163 77 124 
EPS in Rs 1.23 1.02 0.47 -0.08 2.14 8.21 9.85 4.66 7.45 

For the quarter ended 30-09-2021, the company reported a sale of ₹ 375 Cr which is an increase of 18% from the sales registered in the year ago period. 

Expense has increased from the previous quarter and the sales number indicate that Bhansali Engineering share is using this expense for increasing the sales. 

In quarter ended 30-09-21, the net profit of Bhansali Engineering share has increased from its previous quarter which is a great symbol of growth. 

These were some of the highlights in the quarterly results. 

BALANCE SHEET: 

Reserves have increased exponentially and there is a great interest shown by the investors in Bhansali Engineering share. 

In the quarter ended 30-09-21, the company has maintained its debt free record which is a great indicator of strong growth in upcoming future. 

Figures in Rs. Crores 

Balance Sheet Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Sep 2021 
Share Capital  17 17 17 17 17 17 17 17 
Reserves 168 110 145 241 282 340 665 849 
Borrowings 42 32 137 
Other Liabilities  169 191 121 166 230 297 96 139 
Total Liabilities 396 349 420 423 529 653 777 1005 
Fixed Assets  122 82 93 107 144 150 141 137 
CWIP 
Investments 
Other Assets  274 267 326 309 384 500 634 866 
Total Assets 396 349 420 423 529 653 777 1005 

  

SHARE HOLDING SYNOPSIS 

Share Holding Sep 2019 Dec 2019 Mar 2020 Jun 2020 Sep 2020 Dec 2020 Mar 2021 Jun 2021 Sep 2021 
Promoters  55 55 56.45 56.45 56.45 56.45 56.45 56.45 56.45 
FIIs  2.41 1.76 1.1 0.71 0.43 0.9 0.95 2.55 1.88 
DIIs  0.29 0.44 0.17 0.17 0.02 0.16 0.02 0.02 0.02 
Public  42.3 42.8 42.28 42.67 43.1 42.48 42.58 40.98 41.65 

Promoters have maintained their position in this stock with a whopping 56.45%. 

FIIs have reduced their stake in this company while retail investors are the buyers into this stock. 

Let’s figure out how the price action worked for Bhansali Engineering share in just 10 trading sessions. 

In the previous analysis, we did highlight the formation of the reverse head and shoulder pattern.   

Click here for previous analysis on Bhansali Engineering share. 

Once the share price broke the resistance line, a massive rally was seen which ultimately helped the Bhansali Engineering share to reach its all-time high. 

DISCLAIMER

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