Check Before You Invest : Navkar Corporation Ltd

Q: Which industry/sub-sector does Navkar Corporation Ltd belong to?

Navkar Corporation Ltd belongs to the Transportation & Logistics sector, operating specifically within the Logistics segment.

Q: Is Navkar Corporation Ltd a good quality company?

Navkar Corporation 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: Is Navkar Corporation Ltd undervalued or overvalued?

Navkar Corporation Ltd appears Fair, as its key valuation ratios are in line with 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. Price to Earnings, Current: 15.94, Historic Median: 11.86. Price to Book, Current: -, Historic Median: 0.58. Price to Sales, Current: 3.49, Historic Median: 2.17. EV to EBITDA, Current: 11.61, Historic Median: 13.95

Q: Is Navkar Corporation Ltd a good buy now?

Navkar Corporation Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of Navkar Corporation Ltd?

Navkar Corporation Ltd revenue growth is 6.8% for FY-2017, which is in line with its 5-year CAGR of 6.71%, indicating stable growth.

Q: Gross Profit margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Gross profit margin which is the profit after deduction of direct costs, is 32.2% for FY-2017, which is in line with its 5-year median of 32.1%, indicating stable margins.

Q: Operating Profit Margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 38.41% for FY-2017, which is in line with its 5-year median of 38.41% indicating stable margins.

Q: Net Profit Margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Net Profit Margin is 23.08% for FY-2017, is in line with its 5-year median of 23.08%, indicating stable margins. Profitability Metrics. Gross Profit Margin (%), Current: 32.2, Historic Median: 32.1. Operating Profit Margin (%), Current: 38.41, Historic Median: 38.41. Net Profit Margin (%), Current: 23.08, Historic Median: 23.08

Q: Return on Asset of Navkar Corporation Ltd?

Navkar Corporation Ltd Return on Asset is 4.06%, which is below its 5-year historical median of 5.89%, indicating deteriorated asset utilization efficiency.

Q: Return on capital employed (ROCE) of Navkar Corporation Ltd?

Navkar Corporation Ltd Return on capital employed is 6.83% for FY-2017, which is below its 5-year historical median of 9.79%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Check Before You Invest : Navkar Corporation Ltd

Snapshot

Q.1 Which industry/sub-sector does Navkar Corporation Ltd belong to?

Navkar Corporation Ltd belongs to the Transportation & Logistics sector, operating specifically within the Logistics segment.

Q.2 Is Navkar Corporation Ltd a good quality company?

Navkar Corporation 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 Navkar Corporation Ltd undervalued or overvalued?

Navkar Corporation Ltd appears Fair, as its key valuation ratios are in line with 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	15.94	11.86
Price to Book	-	0.58
Price to Sales	3.49	2.17
EV to EBITDA	11.61	13.95

Q.4 Is Navkar Corporation Ltd a good buy now?

Navkar Corporation Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. 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 Navkar Corporation Ltd?

Navkar Corporation Ltd revenue growth is 6.8% for FY-2017, which is in line with its 5-year CAGR of 6.71%, indicating stable growth.

Q.2 Gross Profit margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Gross profit margin which is the profit after deduction of direct costs, is 32.2% for FY-2017, which is in line with its 5-year median of 32.1%, indicating stable margins.

Q.3 Operating Profit Margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 38.41% for FY-2017, which is in line with its 5-year median of 38.41% indicating stable margins.

Q.4 Net Profit Margin of Navkar Corporation Ltd?

Navkar Corporation Ltd Net Profit Margin is 23.08% for FY-2017, is in line with its 5-year median of 23.08%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	32.2	32.1
Operating Profit Margin (%)	38.41	38.41
Net Profit Margin (%)	23.08	23.08

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Navkar Corporation Ltd?

Navkar Corporation Ltd Return on Asset is 4.06%, which is below its 5-year historical median of 5.89%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Navkar Corporation Ltd?

Navkar Corporation Ltd Return on capital employed is 6.83% for FY-2017, which is below its 5-year historical median of 9.79%. 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 Navkar Corporation Ltd?

Navkar Corporation Ltd Return on equity is 6.09% for FY-2017, which is below its 5-year historical median of 11.62%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Navkar Corporation Ltd?

Navkar Corporation Ltd Cash conversion cycle is -60 days, below its 5-year historical median of 53 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	0.18	0.28
ROE (%)	6.09	11.62
ROCE (%)	6.83	9.79
Cash Conversion Cycle	-60 days	53 days

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

Q.9 Debt to Equity ratio of Navkar Corporation Ltd?

Navkar Corporation Ltd Debt-to-Equity ratio is 0.08, which is lower the industry average of 0.44, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Navkar Corporation Ltd?

Navkar Corporation Ltd Debt to cash flow from operations is 4.66, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Navkar Corporation Ltd?

Q.1 Promoter shareholding and pledge status of Navkar Corporation Ltd?

Promoters hold 70.37% of the Navkar Corporation Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Navkar Corporation Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Navkar Corporation Ltd vs industry peers?

Navkar Corporation Ltd revenue CAGR is -3.10%, compared to the industry median CAGR of 0.00%, indicating slower growth and losing its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	6.8	0
Gross Profit Growth (%)	-2.5	14.2
Operating Profit Growth (%)	2.2	11.5
Net Profit Growth (%)	-	12.4

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	0.18	1.75
ROE (%)	6.09	9.41
ROCE (%)	6.83	12.69
Cash Conversion Cycle (days)	-60.36	43

Valuation & price assessment

Q.1 Stock return of Navkar Corporation Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of -6.3% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	-6.3%	18%	18.6%	-10.3%

Q.2 Valuation ratios of Navkar Corporation Ltd vs historical?

The current P/E ratio of 15.94 is higher than its historical median of 11.86, 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	15.94	11.86	19.94
Price to Book	-	0.58	2.00
Price to Sales	3.49	2.17	0.89
EV to EBITDA	11.61	13.95	10.78

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Check Before You Invest : Navkar Corporation Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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