BSE:523826

Stock Analysis Report

Executive Summary

Sovereign Diamonds Limited manufactures and sells gold jewelry, diamond studded jewelry, and silver items in India.

Rewards

Trading at 93.6% below its fair value

Risk Analysis

Earnings have declined by -45.49% per year over past 5 years

Interest payments are not well covered by earnings

Shares are highly illiquid

Does not have a meaningful market cap (₹21M)

+ 1 more risk


Snowflake Analysis

Adequate balance sheet and fair value.

Share Price & News

How has Sovereign Diamonds's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 523826's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

0%

523826

-0.5%

IN Luxury

-1.5%

IN Market


1 Year Return

n/a

523826

18.2%

IN Luxury

10.7%

IN Market

Return vs Industry: Insufficient data to determine how 523826 performed against the Indian Luxury industry.

Return vs Market: Insufficient data to determine how 523826 performed against the Indian Market.


Shareholder returns

523826IndustryMarket
7 Day0%-0.5%-1.5%
30 Day4.7%3.0%-2.7%
90 Day-20.2%9.2%1.3%
1 Yearn/a19.0%18.2%12.7%10.7%
3 Year-62.3%-62.3%52.2%48.8%22.0%15.1%
5 Year-43.0%-43.0%106.9%100.1%34.5%22.0%

Price Volatility Vs. Market

How volatile is Sovereign Diamonds's share price compared to the market and industry in the last 5 years?


Simply Wall St News

1 year ago | Simply Wall St

Top BSE Undervalued Stock

1 year ago | Simply Wall St

Top BSE Undervalued Stock

1 year ago | Simply Wall St

Top BSE Undervalued Stock

Valuation

Is Sovereign Diamonds undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 523826 (₹3.59) is trading below our estimate of fair value (₹56.17)

Significantly Below Fair Value: 523826 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 523826 is unprofitable, so we can't compare its PE Ratio to the Luxury industry average.

PE vs Market: 523826 is unprofitable, so we can't compare its PE Ratio to the Indian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 523826's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 523826 is good value based on its PB Ratio (0.2x) compared to the IN Luxury industry average (0.5x).


Next Steps

Future Growth

How is Sovereign Diamonds forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

19.9%

Forecasted Consumer Durables industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Sovereign Diamonds has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Sovereign Diamonds performed over the past 5 years?

-45.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 523826 is currently unprofitable.

Growing Profit Margin: 523826 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 523826 is unprofitable, and losses have increased over the past 5 years at a rate of -45.5% per year.

Accelerating Growth: Unable to compare 523826's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 523826 is unprofitable, making it difficult to compare its past year earnings growth to the Luxury industry (5.6%).


Return on Equity

High ROE: 523826 has a negative Return on Equity (-6.93%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Sovereign Diamonds's financial position?


Financial Position Analysis

Short Term Liabilities: 523826's short term assets (₹271.1M) exceed its short term liabilities (₹169.9M).

Long Term Liabilities: 523826's short term assets (₹271.1M) exceed its long term liabilities (₹4.0M).


Debt to Equity History and Analysis

Debt Level: 523826's debt to equity ratio (93%) is considered high.

Reducing Debt: 523826's debt to equity ratio has reduced from 162.2% to 93% over the past 5 years.


Balance Sheet

Inventory Level: 523826 has a high level of physical assets or inventory.

Debt Coverage by Assets: 523826's debt is covered by short term assets (assets are 2.2x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: 523826 has been profitable on average in the past, therefore cash runway is not a concern.

Forecast Cash Runway: Insufficient data to determine if 523826 has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

What is Sovereign Diamonds's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%0.6%markettop25%2.6%industryaverage0.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate 523826's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 523826's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 523826's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 523826's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 523826's dividend in 3 years as they are not forecast to pay a notable one for the Indian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.5yrs

Average board tenure


CEO

Ajay Gehani (53yo)

9.4yrs

Tenure

₹3,600,000

Compensation

Mr. Ajay R. Gehani has been the Managing Director at Sovereign Diamonds Limited since September 2, 2010 and serves as its Compliance Officer. Mr. Gehani has been a Director at Sovereign Diamonds Limited si ...


CEO Compensation Analysis

Compensation vs Market: Ajay's total compensation ($USD50.31K) is about average for companies of similar size in the Indian market ($USD50.34K).

Compensation vs Earnings: Ajay's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Ajay Gehani
Chairman9.4yrs₹3.60m60.06% 12.5m
Arundhati Mali
CFO & Woman Director1yrs₹336.77kno data
Kundapur Pai
Non Executive Independent Director14.5yrs₹45.00kno data
Rajesh Arora
Non Executive Independent Director8.5yrs₹45.00kno data

8.5yrs

Average Tenure

53.5yo

Average Age

Experienced Board: 523826's board of directors are considered experienced (8.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Sovereign Diamonds Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sovereign Diamonds Limited
  • Ticker: 523826
  • Exchange: BSE
  • Founded: 1974
  • Industry: Apparel, Accessories and Luxury Goods
  • Sector: Consumer Durables
  • Market Cap: ₹20.779m
  • Shares outstanding: 5.79m
  • Website: https://null

Number of Employees


Location

  • Sovereign Diamonds Limited
  • Sovereign House
  • 11-A, Mahal Industrial Estate
  • Mumbai
  • Maharashtra
  • 400093
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
523826BSE (Mumbai Stock Exchange)YesEquity SharesININRMay 2005

Biography

Sovereign Diamonds Limited manufactures and sells gold jewelry, diamond studded jewelry, and silver items in India. It is also involved in the real estate property development business. The company also exports its products. Sovereign Diamonds Limited was incorporated in 1974 and is based in Mumbai, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 12:34
End of Day Share Price2020/02/14 00:00
Earnings2019/12/31
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.