Chilime is considered a brighter star of the Nepali hydroelectricity sector. It is one of the companies with investors’ confidence intact and a firm hold in investors’ eyes.
Here we are just going to analyze the financials on point to point-to-point basis. This analysis will be compact but a detailed review
Analysis-Check point
1) Profit Loss Analysis
2) Cash & Investment Analysis
3) Growth Analysis
4) Stock Price Analysis
5) Out Look Analysis
- Profit Loss Analysis-Q-1 of 80-81 has seen revenue of 34.28 crore which is 3.66 less than Q-1 of 79-80 where it has seen growth of 5.68% while comparing Quarter to Quarter(Q-Q).
-The operating profit and net profit(NP) are 69% and 10% respectively thanks to Finance income which has given a boost to the NP ratio.
-The significant push in finance income has acted as rocket fuel which has pushed NP to double-digit in terms of percentage.
- Cash & Investment Analysis.
-Chilime’s Cash & Cash Equivalent Has seen a fluctuation over the period of time a fall of 85.15% and 84.07% in Q-Q & YOY comparison.
-It seems it has been using its Cash in Investment in Associates which will be fruitful for the company in the future.
- Growth Analysis
It’s essential to grasp that revenue growth in the hydropower sector may not be substantial, given that its primary revenue source is the generation of electricity,
which has a fixed capacity. Consequently, the revenue stream remains constant unless new projects are integrated.
-Income fluctuations may arise from the seasonal dynamics of the electricity company, influenced by Monsoon and Non-Monsoon seasons.
-The growth in net profit has displayed a degree of consistency over the past two quarters.
-It appears that cash is flowing into the investment department
-The growth will align with Production capacity and other income impacts.
- Stock Price Analysis
Between January 23rd and December 23rd, the stock has maintained a range of 400-500, reaching a 52-week high of 594. The NEPSEÂ has fluctuated between 2200
and 1800 during this period. Simultaneously, the Hydropower sector experienced a notable decline, dropping from 2750 to nearly 2000, representing an approximately
35% decrease. In contrast, CHCL stock appears to be resilient, holding its ground despite the fluctuations in the NEPSE and the decline in the Hydropower index.
- Outlook Analysis.
Prominent it seems NEPSE and sentiment toward the Stock market is holding the flow of Chilime (CHCL), as it hasn’t corrected much in comparison to NEPSE & Hydro index,
As seen in pic below Nepse is only 2% and the hydro index is 3% away from the 52-week low, however, CHCL is still 27 % away.
*Quick outlook*
-Investment in Associates helps in boosting other income and Capital gain of CHCL
-The Unlocking of associate production will be beneficial for CHCL too in a profitability point of view too
-The recent improvement in the operating profit ratio is also a green signal for CHCL.
-The cash is drying in the company which could be a point to look for in the entity
-The growth is almost stagnant.This was a quick 5-point analysis of CHCL (Chilime Hydropower Company Limited)- This is only for educational purposes not a basis for a buy or sell decision.
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