2 Small-Cap Stocks for 2022 with Fundamental analysis

In this article, you will know about 2 Small-Cap Stocks whose fundamentals are good, as well as these stocks, are also available at good valuations.

Heranba Industries limited

The first stock is Heranba Industries Limited. The company has 3 manufacturing facilities with 650+ employees and its product portfolio includes 16 technologies, 80 formulations, and 2 intermediate products.

The company’s market share is 20% and the company’s marketing network is also huge with 9400+ dealers and 200+ representatives. This company exports its product to 60+ countries, IPO of this company came in March 2021 and its issue price was Rs 627.

But this stock was listed at Rs 900 and had a listing gain of 43% and after that its highest price went up to Rs 945. But after that a lot of people booked profit and now its price is running back around its issue price which was ₹658.

Fundamentals of Heranba Industries Limited

Heranba Industries Limited fundamental: It is a small-cap company and its market capitalization is 2634 crores. Its return on equity is 36.3%, ROCE (return on capital employed) is also 45.3%.

Debt: This company has a debt of 45.7 crores while its annual profit is Rs 154 crores and this company also has a free cash flow of Rs 36.4 crores.

The debt of the company is much less than its annual profit, so it will be considered debt-free. Promoters hold 74.6% of the company.

EPS: The company’s EPS (Earning per share) is Rs 46.07 which is good for its price and its P/E ratio is 16.64 while its industry P/E is 20.25.

Pros of Heranba Industries Limited

Heranba Industries Limited pros: The company is almost debt-free.

The company’s profit growth CAGR of last 5 years is 55.59% which is considered good.
And the last three years’ return on equity is also good 36.66%.
Right now the price of this share is less than its intrinsic value.
Its returns are better than FD.
This stock is not in the overbought zone.
And much of the holding of the promoters is not pledged.

Cons of Heranba Industries Limited

Heranba Industries Limited cons: We couldn’t find any company cons.

Financial trend of Heranba Industries Limited

Heranba Industries Limited financial: The company’s profit has been increasing continuously for the last five years and in 2021 it is 154 crores.

Quarterly profit of the company: In comparison to quarter 2 of the last year, the company has made a little less profit in the quarter 2 of this year. The share price of the company is running at Rs 658.75.

KCP Limited

The second stock is KCP Limited. This company works in cement, sugar, heavy engineering, power generation, and hospitality sectors, 55% of its revenue comes from the cement business.

They have 2 cement plants which have a combined capacity of 4.3 million tonnes per annum and this company also manufactures rapid hardening cement along with Ordinary Cement.

After this 31% of the revenue comes from the sugar business which the company operates in Vietnam through its subsidiary company KCP Vietnam Industries limited which has 2 sugar plants in Vietnam with a total crushing capacity of 11000-ton cans per day.

Then 7% of the revenue comes from the power business which includes all types of hydel, wind, thermal and solar power, and in this, their total capacity is 34 MW.

After that 5% revenue comes from heavy engineering business in which the company manufactures heavy equipment for cement, sugar, power, mining, mineral oil and gas, and other industries, and in this business, it has customers from many countries.

And the remaining 1% of revenue comes from the hotel business, this company owns Mercure Hotel Hyderabad which has 128 rooms. So the business of this company is quite diversified and the general risk is less in such companies.

Fundamentals of KCP Limited

Debt: This company has a debt of 380 crores while its annual profit is 163 crores and this company also has a free cash flow of 114 crores, debt to equity ratio is 0.35. Its debt to equity ratio is much less than 1.

Its EPS (earning per share) is Rs 18.2 which is good according to its price and the promoter holding here is 43.9% which is considered to be average.

Its stock P/E is 6.92 while its industry P/E is 15.3.

Pros of KCP Limited

KCP Limited Pros: This company has reduced its debt and it is expected that this company can give good quarters results.

Right now the current price of the share is less than its intrinsic value.
Its returns are better than FD.
This stock is not in the overbought zone.
And the holding of promoters is not much pledged.
stock ASM/GSM is not on any such list.

Cons of KCP Limited

KCP limited cons: The company’s sales growth for the last five years is low at 5.75%.

But this company does not give that good dividend. And if it is a very small company, then even dividend expectation cannot be done from it.

Financial trend of KCP limited

KCP limited financial trend: Since 2017 its profit was increasing but in 2020 its profit was reduced but did not go negative, even then this company had a good profit of 27.13 crores.

In 2021, the company has got the highest profit of 163 crores.

Quarterly Profit: In comparison to Q2 (September 2020) of last year, it has made more profit in Quarter 2 of this year of 53.58 crores.

And right now the price of one share is running at Rs 126.

This article is only for education purpose and the author has his own views and research, so if you invest in these stocks then do it at your own risk and do the research yourself before investing.

How are the Fundamentals of Heramba Industries Limited?

Heranba Industries Limited fundamental: It is a small-cap company and its market capitalization is 2634 crores. Its return on equity is 36.3%, ROCE (return on capital employed) is also 45.3%.
Debt: This company has a debt of 45.7 crores while its annual profit is Rs 154 crores and this company also has a free cash flow of Rs 36.4 crores.

How are the Fundamentals of KCP Limited?

KCP Limited fundamental: It is a small-cap company and its market capitalization is 1624 crores, its return on equity is good 17.8%, ROCE (return on capital employed) is also 21.6%.
Debt: This company has a debt of 380 crores while its annual profit is 163 crores and this company also has a free cash flow of 114 crores, debt to equity ratio is 0.35.