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Check Before You Invest : Forbes Precision Tools And Machine Parts Ltd

BSE: 544186 NSE: ISIN: INE0TT901016
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering - Industrial Equipments

Snapshot

Q.1 Which industry/sub-sector does Forbes Precision Tools And Machine Parts Ltd belong to?
Forbes Precision Tools And Machine Parts Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering - Industrial Equipments segment.
Q.2 Is Forbes Precision Tools And Machine Parts Ltd a good quality company?
Forbes Precision Tools And Machine Parts 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 Forbes Precision Tools And Machine Parts Ltd undervalued or overvalued?
Forbes Precision Tools And Machine Parts Ltd appears Somewhat Undervalued, as its key valuation ratios are lower 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 0-year
Historic Median
Price to Earnings 25.66 39.45
Price to Book 4.38 0.73
Price to Sales 2.94 0.24
EV to EBITDA 13.18 14.12
Q.4 Is Forbes Precision Tools And Machine Parts Ltd a good buy now?
Forbes Precision Tools And Machine Parts 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.

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

Q.1 Debt to Equity ratio of Forbes Precision Tools And Machine Parts Ltd?
Forbes Precision Tools And Machine Parts Ltd Debt-to-Equity ratio is 0.12, which is above the industry average of , indicating higher debt levels in the industry.

Q.2 Debt to cash flow from operations of Forbes Precision Tools And Machine Parts Ltd?
Forbes Precision Tools And Machine Parts Ltd Debt to cash flow from operations is 0.38, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Forbes Precision Tools And Machine Parts Ltd?

Q.1 Promoter shareholding and pledge status of Forbes Precision Tools And Machine Parts Ltd?
Promoters hold 73.85% of the Forbes Precision Tools And Machine Parts Ltd, with 94.40% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Forbes Precision Tools And Machine Parts Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Forbes Precision Tools And Machine Parts Ltd vs industry peers?
Forbes Precision Tools And Machine Parts Ltd revenue CAGR is %, compared to the industry median CAGR of 0%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 0-year
Industry Median
Revenue Growth (%) - -
Gross Profit Growth (%) 5.9 17.9
Operating Profit Growth (%) - 16.4
Net Profit Growth (%) -3.3 17.3
Operating Efficiency
Current Level 0-year
Industry Median
Asset Turnover (x) 1.03 0.52
ROE (%) - 2.05
ROCE (%) - 3.6
Cash Conversion Cycle (days) 59.48 46

Valuation & price assessment

Q.1 Stock return of Forbes Precision Tools And Machine Parts Ltd over the last decade?
Over the last 1 year(s), the stock has delivered a CAGR of -20.08% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - -20.1%
Q.2 Valuation ratios of Forbes Precision Tools And Machine Parts Ltd vs historical?
The current P/E ratio of 25.66 is lower than its historical median of 39.45, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 0-year historical median and industry numbers?
Valuation Ratios Current 0-year
Historic Median
0-year
Industry Median
Price to Earnings 25.66 39.45 -
Price to Book 4.38 0.73 -
Price to Sales 2.94 0.24 -
EV to EBITDA 13.18 14.12 -

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