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Check Before You Invest : Chandrima Mercantiles Ltd

BSE: 540829 NSE: ISIN: INE371F01024
  |   Sector:  Miscellaneous   |   Industry:  Trading

Snapshot

Q.1 Which industry/sub-sector does Chandrima Mercantiles Ltd belong to?
Chandrima Mercantiles Ltd belongs to the Miscellaneous sector, operating specifically within the Trading segment.
Q.2 Is Chandrima Mercantiles Ltd a good quality company?
Chandrima Mercantiles Ltd is a weak quality company, based on a inconsistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Chandrima Mercantiles Ltd undervalued or overvalued?
Chandrima Mercantiles Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 55.69 28.35
Price to Book 2.07 -0.54
Price to Sales 2.75 0.09
EV to EBITDA 46.37 25.03
Q.4 Is Chandrima Mercantiles Ltd a good buy now?
Chandrima Mercantiles Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd revenue growth is 50.5% for FY-2025, which is above its 5-year CAGR of NA%, indicating faster growth.

Q.2 Gross Profit margin of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Gross profit margin which is the profit after deduction of direct costs, is 2.4% for FY-2025, which is above its 5-year median of 0.1%, indicating increasing margins.

Q.3 Operating Profit Margin of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 2.38% for FY-2025, which is above its 5-year median of 0.03% indicating increasing margins.

Q.4 Net Profit Margin of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Net Profit Margin is 2.5% for FY-2025, is above its 5-year median of 0.08%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 2.4 0.1
Operating Profit Margin (%) 2.38 0.03
Net Profit Margin (%) 2.5 0.08

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Return on Asset is 0.79%, which is above its 5-year historical median of 0.15%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Return on capital employed is 0.9% for FY-2025, which is in line with its 5-year historical median of 0.9%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Return on equity is 0.98% for FY-2025, which is above its 5-year historical median of 0.3%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Cash conversion cycle is 208 days, above its 5-year historical median of -144 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.31 1.1
ROE (%) 0.98 0.3
ROCE (%) 0.9 0.9
Cash Conversion Cycle 208 days -144 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Debt-to-Equity ratio is 0.03, which is lower the industry average of 0.03, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Chandrima Mercantiles Ltd?
Chandrima Mercantiles Ltd Debt to cash flow from operations is -0.07, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Chandrima Mercantiles Ltd?

Q.1 Promoter shareholding and pledge status of Chandrima Mercantiles Ltd?
Promoters hold 0.00% of the Chandrima Mercantiles Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Chandrima Mercantiles Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Chandrima Mercantiles Ltd vs industry peers?
Chandrima Mercantiles Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 0%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 50.5 -
Gross Profit Growth (%) -50 17.7
Operating Profit Growth (%) -50 16.1
Net Profit Growth (%) 0 17.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.31 0.52
ROE (%) 0.98 2.05
ROCE (%) 0.9 3.6
Cash Conversion Cycle (days) 208.13 46

Valuation & price assessment

Q.1 Stock return of Chandrima Mercantiles Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 92.45% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- 92.5% 131.8% 108.2%
Q.2 Valuation ratios of Chandrima Mercantiles Ltd vs historical?
The current P/E ratio of 55.69 is higher than its historical median of 28.35, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 55.69 28.35 33.62
Price to Book 2.07 -0.54 1.57
Price to Sales 2.75 0.09 2.21
EV to EBITDA 46.37 25.03 14.09

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