NSEI:LGBBROSLTD

Stock Analysis Report

L.G. Balakrishnan & Bros

Executive Summary

L.G. Balakrishnan & Bros Limited manufactures and sells chains, sprockets, and metal formed parts for automotive applications in India.

Snowflake

Fundamentals

Flawless balance sheet and fair value.

Risks

  • L.G. Balakrishnan & Bros has significant price volatility in the past 3 months.
  • L.G. Balakrishnan & Bros is covered by less than 3 analysts.

Share Price & News

How has L.G. Balakrishnan & Bros's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.8%

NSEI:LGBBROSLTD

-3.8%

IN Machinery

-2.9%

IN Market


1 Year Return

-37.4%

NSEI:LGBBROSLTD

-30.7%

IN Machinery

-15.9%

IN Market

LGBBROSLTD underperformed the Machinery industry which returned -30.7% over the past year.

LGBBROSLTD underperformed the Market in India which returned -15.9% over the past year.


Share holder returns

LGBBROSLTDIndustryMarket
7 Day0.8%-3.8%-2.9%
30 Day29.3%-12.2%-5.7%
90 Day-10.3%-21.4%-11.0%
1 Year-36.4%-37.4%-29.6%-30.7%-14.1%-15.9%
3 Year47.8%43.0%-7.6%-11.1%15.7%9.5%
5 Year36.5%28.7%31.4%24.1%33.2%20.5%

Price Volatility Vs. Market

How volatile is L.G. Balakrishnan & Bros's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is L.G. Balakrishnan & Bros undervalued based on future cash flows and its price relative to the stock market?

11.23x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

L.G. Balakrishnan & Bros's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

L.G. Balakrishnan & Bros's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

L.G. Balakrishnan & Bros is good value based on earnings compared to the IN Machinery industry average.

L.G. Balakrishnan & Bros is good value based on earnings compared to the India market.


Price Based on Expected Growth

L.G. Balakrishnan & Bros is good value based on expected growth next year.


Price Based on Value of Assets

L.G. Balakrishnan & Bros is overvalued based on assets compared to the IN Machinery industry average.


Next Steps

Future Growth

How is L.G. Balakrishnan & Bros expected to perform in the next 1 to 3 years based on estimates from 1 analyst?

17.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

L.G. Balakrishnan & Bros's revenue is expected to grow by 12.3% yearly, however this is not considered high growth (20% yearly).

L.G. Balakrishnan & Bros's earnings are expected to grow by 17.4% yearly, however this is not considered high growth (20% yearly).

L.G. Balakrishnan & Bros's revenue growth is expected to exceed the India market average.

L.G. Balakrishnan & Bros's earnings growth is positive but not above the India market average.

L.G. Balakrishnan & Bros's earnings growth is expected to exceed the low risk savings rate of 7.6%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if L.G. Balakrishnan & Bros will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has L.G. Balakrishnan & Bros performed over the past 5 years?

9.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

L.G. Balakrishnan & Bros's year on year earnings growth rate has been positive over the past 5 years.

L.G. Balakrishnan & Bros's 1-year earnings growth is less than its 5-year average (2% vs 9.1%)

L.G. Balakrishnan & Bros's earnings growth has not exceeded the IN Machinery industry average in the past year (2% vs 13.3%).


Return on Equity

L.G. Balakrishnan & Bros has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

L.G. Balakrishnan & Bros used its assets more efficiently than the IN Machinery industry average last year based on Return on Assets.


Return on Capital Employed

L.G. Balakrishnan & Bros's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is L.G. Balakrishnan & Bros's financial position?


Financial Position Analysis

L.G. Balakrishnan & Bros is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

L.G. Balakrishnan & Bros's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

L.G. Balakrishnan & Bros's level of debt (32%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (47.3% vs 32% today).

Debt is well covered by operating cash flow (46.7%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 10.6x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 2.6x debt.


Next Steps

Dividend

What is L.G. Balakrishnan & Bros's current dividend yield, its reliability and sustainability?

1.53%

Current Dividend Yield


Dividend Yield and Payments Analysis

L.G. Balakrishnan & Bros's pays a higher dividend yield than the bottom 25% of dividend payers in India (0.65%).

L.G. Balakrishnan & Bros's dividend is below the markets top 25% of dividend payers in India (2.67%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (5.8x coverage).


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

Management

What is the CEO of L.G. Balakrishnan & Bros's salary, the management and board of directors tenure and is there insider trading?

9.8yrs

Average management tenure


CEO

Balakrishnan Vijayakumar (66yo)

0.0yrs

Tenure

₹37,483,000

Compensation

Mr. Balakrishnan Vijayakumar has been Chairman at L.G. Balakrishnan & Bros Limited since October 15, 2008 and its Director since November 25, 1986. He serves as Managing Director of L.G. Balakrishnan & Bro ...


CEO Compensation Analysis

Balakrishnan's remuneration is higher than average for companies of similar size in India.

Balakrishnan's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

9.8yrs

Average Tenure

52yo

Average Age

The average tenure for the L.G. Balakrishnan & Bros management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

11.3yrs

Average Tenure

58.5yo

Average Age

The average tenure for the L.G. Balakrishnan & Bros board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

More shares have been bought than sold by L.G. Balakrishnan & Bros individual insiders in the past 3 months.


Recent Insider Transactions

Buy₹699,60713 Aug 19
K. Arjun
EntityIndividual
Shares2,443
Max Price₹286.37
Buy₹3,650,17313 Aug 19
Moonlight Family Private Trust
EntityCompany
Shares12,450
Max Price₹293.19
Buy₹2,114,53109 Aug 19
Moonlight Family Private Trust
EntityCompany
Shares8,093
Max Price₹261.28
Buy₹274,28529 Jun 19
LG Corp.
EntityCompany
Shares800
Max Price₹342.86
Buy₹590,72528 Jun 19
LG Corp.
EntityCompany
Shares1,700
Max Price₹347.49
Buy₹895,92826 Jun 19
LG Corp.
EntityCompany
Shares2,500
Max Price₹358.37
Buy₹810,97722 Jun 19
LG Corp.
EntityCompany
Shares2,260
Max Price₹358.84
Buy₹1,723,88915 Oct 18
LG Corp.
EntityCompany
Shares4,006
Max Price₹430.33
Buy₹9,112,93610 Oct 18
LG Corp.
EntityCompany
Shares22,000
Max Price₹414.22

Ownership Breakdown


Management Team

  • Balakrishnan Vijayakumar (66yo)

    Chairman & MD

    • Tenure: 0.0yrs
    • Compensation: ₹37.48m
  • P. Prabakaran (60yo)

    MD & Executive Director

    • Tenure: 11.3yrs
    • Compensation: ₹10.99m
  • A. Mohan (59yo)

    Chief Operating Officer - Forging Divisions

    • Tenure: 13.3yrs
  • M. Lakshmi Joshi (51yo)

    GM of Legal

    • Tenure: 0.0yrs
    • Compensation: ₹2.96m
  • N. Rengaraj (50yo)

    Chief Financial Officer

    • Tenure: 9.8yrs
    • Compensation: ₹4.06m
  • P. Subbiah (53yo)

    General Manager

    • Tenure: 0.0yrs
  • N. Kumar (48yo)

    General Manager

    • Tenure: 0.0yrs
  • P. S. Ramalingam (56yo)

    Deputy General Manager

    • Tenure: 0.0yrs
  • J. Prakash (48yo)

    Deputy General Manager

    • Tenure: 0.0yrs
  • M. Dhanasekar (48yo)

    Deputy General Manager

    • Tenure: 0.0yrs

Board Members

  • Balakrishnan Vijayakumar (66yo)

    Chairman & MD

    • Tenure: 0.0yrs
    • Compensation: ₹37.48m
  • P. Shanmugasundaram (71yo)

    Non-Executive Independent Director

    • Tenure: 18.3yrs
    • Compensation: ₹310.00k
  • P. Prabakaran (60yo)

    MD & Executive Director

    • Tenure: 11.3yrs
    • Compensation: ₹10.99m
  • V. Govindarajulu (63yo)

    Non-Executive Independent Director

    • Tenure: 21.2yrs
    • Compensation: ₹310.00k
  • Sitaraman Sivakumar (67yo)

    Non-Executive Non-Independent Director

    • Tenure: 23.2yrs
    • Compensation: ₹130.00k
  • R. Shankar (49yo)

    Non-Executive Independent Director

    • Tenure: 11.3yrs
    • Compensation: ₹140.00k
  • Rajsri Vijayakumar (38yo)

    Non-Executive Director

    • Tenure: 12.8yrs
    • Compensation: ₹130.00k
  • Vijayakumar Rajvirdhan (36yo)

    Non-Executive Director

    • Tenure: 8.8yrs
    • Compensation: ₹130.00k
  • Kanchana Manavalan (57yo)

    Additional Independent Director

    • Tenure: 0.6yrs
    • Compensation: ₹30.00k
  • G.D. Rajkumar (51yo)

    Independent Director

    • Tenure: 0.3yrs

Company Information

L.G. Balakrishnan & Bros Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: L.G. Balakrishnan & Bros Limited
  • Ticker: LGBBROSLTD
  • Exchange: NSEI
  • Founded: 1937
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: ₹10.447b
  • Shares outstanding: 31.39m
  • Website: https://www.lgb.co.in

Location

  • L.G. Balakrishnan & Bros Limited
  • 6/16/13, Krishnarayapuram Road
  • Ganapathy
  • Coimbatore
  • Tamil Nadu
  • 641006
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
500250BSE (Mumbai Stock Exchange)YesEquity SharesININRJan 1996
LGBBROSLTDNSEI (National Stock Exchange of India)YesEquity SharesININRJan 1996

Biography

L.G. Balakrishnan & Bros Limited manufactures and sells chains, sprockets, and metal formed parts for automotive applications in India. It operates through Transmission, Metal Forming, and Others segments. ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/23 12:49
End of Day Share Price2019/08/23 00:00
Earnings2019/06/30
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.