SHREE RENUKA SUGAR Trade/Investment Idea On Weekly Chart
WHAT IS RELATIVE STRENGTH ?
(RELATIVE STRENGTH is different from RELATIVE STRENGTH INDEX)
Comparing the performance of an individual stock to a benchmark index like the Nifty can help gauge its relative strength. The concept behind dividing the stock's performance by the Nifty index is to normalize the data and provide a measure of how the stock is performing relative to the broader market.
Here's how it works:
Calculation: To calculate the relative strength, you divide the price of the individual stock by the value of the Nifty index at the same point in time. For example, if the stock is trading at ₹150 and the Nifty index is at 15,000, the relative strength would be 150/15000 = 0.01.
Interpretation: A relative strength value greater than 1 indicates that the stock has outperformed the Nifty, as its price has increased at a faster rate compared to the index. Conversely, a relative strength value less than 1 suggests underperformance relative to the Nifty.
Trend Analysis: Monitoring changes in relative strength over time can provide insights into the stock's momentum and its ability to outperform or underperform the broader market. Consistently high relative strength may indicate a strong uptrend, while consistently low relative strength may signal weakness.
Confirmation: Relative strength analysis is often used alongside other technical and fundamental indicators to confirm trading decisions. For example, if a stock is exhibiting strong relative strength and also has positive earnings growth and increasing trading volume, it may be considered a bullish opportunity.
Risk Management: While relative strength analysis can identify potential opportunities, it's essential to consider risk factors such as volatility, liquidity, and fundamental strength before making trading decisions. Diversification and risk management strategies should always be employed.
Overall, comparing a stock's performance to a benchmark like the Nifty through relative strength analysis can help investors assess its relative performance and identify potential trading opportunities. However, it's important to use this analysis as part of a comprehensive approach to trading and to consider other factors that may influence the stock's price movements.
FUNDAMENTALS:
Shree Renuka Sugars Ltd shares SWOT Analysis :
STRENGTHS -
Strong Momentum: Price above short, medium and long term moving averages
Strong cash generating ability from core business - Improving Cash Flow from operation for last 2 years
Company able to generate Net Cash - Improving Net Cash Flow for last 2 years
WEAKNESS -
Red Flag: High Interest Payments Compared to Earnings
Inefficient use of assets to generate profits - ROA declining in the last 2 years
Decline in Net Profit with falling Profit Margin (QoQ)
OPPORTUNITY -
Results Screener: Stocks with upcoming results which are seeing positive shifts in share price
Stock with Low PE (PE < = 10)
RSI indicating price strength.
Q1FY24 Quarterly Result Announced for Shree Renuka Sugars Ltd.
Shree Renuka Sugars announced Q1FY24 results:
Total income up by 18% over Q1FY23 from Rs 19,401 million to Rs 22,865 million. Refinery contributed ~70% of topline.
Gross profit has improved from Rs 3,048 million to 3,562 million up by 17%.
EBITDA has improved from Rs 1,102 million to 1,468 million up by 33%. EBITDA margin improved by 74 bps.
Volume growth was led by
1) Domestic sugar sales (up by 33%) of which Consumer pack sales (grew by 9%) and
2) Refinery (2%).
Distillery had a record production of 4.67 crore liters despite being off-season due to availability of stored molasses, compared to 4.62 crore liter produced in the previous year.
Atul Chaturvedi, Executive Chairman, “This quarter’s results must be seen in the light of inflationary headwinds, high interest rates, weakening currency and disruption caused at our Kandla refinery by cyclone Biparjoy. We have commenced the first quarter on a positive note and achieved healthy growth. Our total income for the quarter has increased by 18% over the previous year. Revenues have grown significantly across all segments with upside in our refinery and sugar business.
The delay in the onset of monsoon in the country was offset due to the torrential rains in the sugarcane belts of Maharashtra and Karnataka in June and we anticipate adequate sugarcane availability in the upcoming season. With the further thrust on ESG initiatives, our organic manure “BHU SANJIVANI” was launched at our Munoli unit (Karnataka) recently which is expected to improve soil health and increasing farmer’s income by increasing quantity and quality of their crop yield."
Sunil Ranka, Chief Financial Officer, “Shree Renuka Sugars has delivered one of the best performances in the first quarter with a gross profit growth of about 17% and EBITDA growth of 33%. The current results demonstrate our unwavering commitment to operational excellence and providing superior results to our stakeholders. High volumes and margins propped EBITDA up to Rs 1,468 million from EBITDA of Rs 1,102 million in the previous year.
Even after increase in the FRP (fair and remunerative price), which is likely to lead to some cost escalation, the same should not pose a problem as the macro environment is supportive and the industry expects further upward improvement in the ethanol purchase price. Good monsoon, strong sugarcane planting and government policies will continue to keep Renuka on the accelerated growth path.”
SHAREHOLDINGS :
Wilmar Sugar Holdings Pte. Ltd. (PROMOTER) - 62.5 %
Huf (PUBLIC) - 0.9 %
Icici Bank LtD. (DII) - 8.1 %
Promoters holding remains unchanged at 62.48% in Dec 2023 qtr.
FII/FPI have increased holdings from 3.16% to 3.22% in Dec 2023 qtr.
Mutual Funds have increased holdings from 0.08% to 0.10% in Dec 2023 qtr.
UPCOMING EVENT • FEB 09, 2024
Board Meeting - Quarterly Results
The latest board meeting for Shree Renuka Sugars Ltd. took place on Feb 09, 2024, for the purpose of Quarterly Results .
That's all for now.
N.B : I wanted to emphasize that the views I express are strictly personal and should not be construed as advice. It is crucial to consult with your financial advisor before making any trades or investment decisions. The complexity and unpredictability of financial markets underscore the importance of seeking professional guidance tailored to your individual financial circumstances and goals.
(RELATIVE STRENGTH is different from RELATIVE STRENGTH INDEX)
Comparing the performance of an individual stock to a benchmark index like the Nifty can help gauge its relative strength. The concept behind dividing the stock's performance by the Nifty index is to normalize the data and provide a measure of how the stock is performing relative to the broader market.
Here's how it works:
Calculation: To calculate the relative strength, you divide the price of the individual stock by the value of the Nifty index at the same point in time. For example, if the stock is trading at ₹150 and the Nifty index is at 15,000, the relative strength would be 150/15000 = 0.01.
Interpretation: A relative strength value greater than 1 indicates that the stock has outperformed the Nifty, as its price has increased at a faster rate compared to the index. Conversely, a relative strength value less than 1 suggests underperformance relative to the Nifty.
Trend Analysis: Monitoring changes in relative strength over time can provide insights into the stock's momentum and its ability to outperform or underperform the broader market. Consistently high relative strength may indicate a strong uptrend, while consistently low relative strength may signal weakness.
Confirmation: Relative strength analysis is often used alongside other technical and fundamental indicators to confirm trading decisions. For example, if a stock is exhibiting strong relative strength and also has positive earnings growth and increasing trading volume, it may be considered a bullish opportunity.
Risk Management: While relative strength analysis can identify potential opportunities, it's essential to consider risk factors such as volatility, liquidity, and fundamental strength before making trading decisions. Diversification and risk management strategies should always be employed.
Overall, comparing a stock's performance to a benchmark like the Nifty through relative strength analysis can help investors assess its relative performance and identify potential trading opportunities. However, it's important to use this analysis as part of a comprehensive approach to trading and to consider other factors that may influence the stock's price movements.
FUNDAMENTALS:
Shree Renuka Sugars Ltd shares SWOT Analysis :
STRENGTHS -
Strong Momentum: Price above short, medium and long term moving averages
Strong cash generating ability from core business - Improving Cash Flow from operation for last 2 years
Company able to generate Net Cash - Improving Net Cash Flow for last 2 years
WEAKNESS -
Red Flag: High Interest Payments Compared to Earnings
Inefficient use of assets to generate profits - ROA declining in the last 2 years
Decline in Net Profit with falling Profit Margin (QoQ)
OPPORTUNITY -
Results Screener: Stocks with upcoming results which are seeing positive shifts in share price
Stock with Low PE (PE < = 10)
RSI indicating price strength.
Q1FY24 Quarterly Result Announced for Shree Renuka Sugars Ltd.
Shree Renuka Sugars announced Q1FY24 results:
Total income up by 18% over Q1FY23 from Rs 19,401 million to Rs 22,865 million. Refinery contributed ~70% of topline.
Gross profit has improved from Rs 3,048 million to 3,562 million up by 17%.
EBITDA has improved from Rs 1,102 million to 1,468 million up by 33%. EBITDA margin improved by 74 bps.
Volume growth was led by
1) Domestic sugar sales (up by 33%) of which Consumer pack sales (grew by 9%) and
2) Refinery (2%).
Distillery had a record production of 4.67 crore liters despite being off-season due to availability of stored molasses, compared to 4.62 crore liter produced in the previous year.
Atul Chaturvedi, Executive Chairman, “This quarter’s results must be seen in the light of inflationary headwinds, high interest rates, weakening currency and disruption caused at our Kandla refinery by cyclone Biparjoy. We have commenced the first quarter on a positive note and achieved healthy growth. Our total income for the quarter has increased by 18% over the previous year. Revenues have grown significantly across all segments with upside in our refinery and sugar business.
The delay in the onset of monsoon in the country was offset due to the torrential rains in the sugarcane belts of Maharashtra and Karnataka in June and we anticipate adequate sugarcane availability in the upcoming season. With the further thrust on ESG initiatives, our organic manure “BHU SANJIVANI” was launched at our Munoli unit (Karnataka) recently which is expected to improve soil health and increasing farmer’s income by increasing quantity and quality of their crop yield."
Sunil Ranka, Chief Financial Officer, “Shree Renuka Sugars has delivered one of the best performances in the first quarter with a gross profit growth of about 17% and EBITDA growth of 33%. The current results demonstrate our unwavering commitment to operational excellence and providing superior results to our stakeholders. High volumes and margins propped EBITDA up to Rs 1,468 million from EBITDA of Rs 1,102 million in the previous year.
Even after increase in the FRP (fair and remunerative price), which is likely to lead to some cost escalation, the same should not pose a problem as the macro environment is supportive and the industry expects further upward improvement in the ethanol purchase price. Good monsoon, strong sugarcane planting and government policies will continue to keep Renuka on the accelerated growth path.”
SHAREHOLDINGS :
Wilmar Sugar Holdings Pte. Ltd. (PROMOTER) - 62.5 %
Huf (PUBLIC) - 0.9 %
Icici Bank LtD. (DII) - 8.1 %
Promoters holding remains unchanged at 62.48% in Dec 2023 qtr.
FII/FPI have increased holdings from 3.16% to 3.22% in Dec 2023 qtr.
Mutual Funds have increased holdings from 0.08% to 0.10% in Dec 2023 qtr.
UPCOMING EVENT • FEB 09, 2024
Board Meeting - Quarterly Results
The latest board meeting for Shree Renuka Sugars Ltd. took place on Feb 09, 2024, for the purpose of Quarterly Results .
That's all for now.
N.B : I wanted to emphasize that the views I express are strictly personal and should not be construed as advice. It is crucial to consult with your financial advisor before making any trades or investment decisions. The complexity and unpredictability of financial markets underscore the importance of seeking professional guidance tailored to your individual financial circumstances and goals.
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