ORIENT ELECTRIC SHARE: TARGET ACHIEVED!!!

Hello and welcome back to one more interesting article wherein We’ll discuss the Orient electric share which was analysed earlier and has achieved the target predicted by us in a span of 93 trading sessions.

Let’s check the parameters which helped Orient electric share to achieve its total target of 30% approximately in 93 trading sessions.

BUSINESS ANALYSIS FOR TARGET ACHIEVEMENT

Orient electric is the 3^rd largest company in the fans segment and has been in the market for the past 60 years.

Orient electric is among the ‘Fortune India 500’ companies with a presence in over 40 countries.

Company has brought in two new fans namely Summer Breeze Pro and Rapid Air and also has some plans to refresh the existing fan named Twister.

Orient Electric eyes smaller towns and rural areas for growth in fans business and to increase its market share in the next 12 months.

The company has a well-organised distribution network reaching to 1,25,000 retail outlets and a great service network in more than 450 cities.

Orient electric has a market share of 20% in fans sector and manufactures 10 million units per annum in Kolkata and Faridabad plants.

Electrical consumer durables segment’s revenue was up at ₹ 454.50 Cr from ₹ 304.35 Cr. This vertical saw a growth of 38.2% which is a commendable achievement by the company.

Switchgear and lighting division saw a sales growth of 35.7% on year on year basis at ₹ 175 Cr.

With the new orders coming up the export market of the company also opened up while the business related to tender remained a bit sluggish.

Currently the revenue of Orient Electric is largely driven by fans, but the company is striving to expand its other products for improving the business.

Demand was definitely rising but electronic firms were battling with elevated commodity costs. These raw material costs were elevated in the April-June quarter which definitely impacted the gross margins in the September quarter of 2021.

FINANCIAL ANALYSIS FOR TARGET ACHIEVEMENT

QUARTERLY RESULTS:

Figures in Rs. Crores

Quarterly Results	Mar 2019	Jun 2019	Sep 2019	Dec 2019	Mar 2020	Jun 2020	Sep 2020	Dec 2020	Mar 2021	Jun 2021	Sep 2021
Sales	638	568	435	496	563	179	434	618	802	422	594
Expenses	567	524	413	450	498	198	376	534	705	400	532
Operating Profit	71	44	22	45	65	-19	58	84	97	22	62
OPM %	0.11	0.08	0.05	0.09	0.12	-0.11	0.13	0.14	0.12	0.05	0.1
Other Income	3	1	1	1	1	1	1	1	4	1	1
Interest	7	7	5	7	8	6	4	5	5	5	5
Depreciation	6	9	10	10	11	11	11	11	11	12	12
Profit before tax	60	29	8	29	48	-35	43	69	84	7	47
Tax %	0.36	0.34	0.37	0.35	0.26	0.23	0.25	0.25	0.26	0.26	0.25
Net Profit	39	19	5	19	36	-27	32	52	63	5	35
EPS in Rs	1.82	0.89	0.23	0.9	1.69	-1.29	1.53	2.45	2.95	0.24	1.64

For the quarter ended 30-09-2021, the company reported a sales of ₹ 594 Cr which is an increase of 27% from the sales registered in the year ago period.

Expense has increased from the previous quarter, but the company is utilizing it for sales growth which is evident from the sales results.

 In the quarter ended 30-09-21, the net profit increased drastically from ₹ 5 Cr to ₹ 35 Cr.

BALANCE SHEET:

Reserves have increased gradually and there is a great interest shown by the investors in Orient electric share.

In the quarter ended 30-09-21, the borrowings have gradually reduced from the year 2017.

Figures in Rs. Crores

Balance Sheet	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Sep 2021
Share Capital	21	21	21	21	21	21
Reserves	192	242	285	338	434	447
Borrowings	211	186	135	155	61	87
Other Liabilities	338	359	447	446	645	479
Total Liabilities	740	808	889	960	1162	1035
Fixed Assets	109	106	117	190	186	216
CWIP	0	5	4	10	11	5
Investments	0	0	0	0	0	0
Other Assets	630	698	768	760	965	814
Total Assets	740	808	889	960	1162	1035

SHARE HOLDING SYNOPSIS

Share Holding	Mar 2019	Jun 2019	Sep 2019	Dec 2019	Mar 2020	Jun 2020	Sep 2020	Dec 2020	Mar 2021	Jun 2021	Sep 2021
Promoters	38.52	38.52	38.52	38.52	38.52	38.52	38.52	38.52	38.52	38.48	38.52
FIIs	4.18	4.24	5.07	5.38	5.13	5.08	6.05	7.53	9.23	8.8	8.74
DIIs	19.05	20.82	20.57	19.1	19.85	21.22	22.04	23.02	22.57	22.35	23.78
Government	0.26	0	0	0	0	0	0	0	0	0	0
Public	37.99	36.42	35.84	36.99	36.5	35.17	33.39	30.93	29.68	30.37	28.96

Promoters have maintained their position in this stock with an average % of 38.52.

DIIs have increased their stake in this company.

Now, let’s deep dive into the technicalities of Orient electric share.

CHART PATTERN ANALYSIS

During the earlier analysis we did highlight the formation of the cup and handle pattern.  

Click here for previous analysis Orient electric share.

Orient electric did achieve its target of ₹ 400.50 and rallied till ₹ 408 showcasing a target achievement of 30%.

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