ADOR WELDING 2022-23 Annual Report Analysis

Fri, 21 Jul

ADOR WELDING has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

ADOR WELDING Income Statement Analysis

• Operating income during the year rose 17.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 26.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 11.3% in FY23 as against 10.5% in FY22.
• Depreciation charges increased by 6.5% and finance costs decreased by 34.5% YoY, respectively.
• Other income grew by 21.7% YoY.
• Net profit for the year grew by 31.3% YoY.
• Net profit margins during the year grew from 6.8% in FY22 to 7.6% in FY23.

ADOR WELDING Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	6,615	7,768	17.4%
Other income	Rs m	55	67	21.7%
Total Revenues	Rs m	6,670	7,834	17.5%
Gross profit	Rs m	694	879	26.5%
Depreciation	Rs m	109	116	6.5%
Interest	Rs m	58	38	-34.5%
Profit before tax	Rs m	582	791	35.9%
Tax	Rs m	131	198	51.9%
Profit after tax	Rs m	452	593	31.3%
Gross profit margin	%	10.5	11.3
Effective tax rate	%	22.4	25.1
Net profit margin	%	6.8	7.6

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ADOR WELDING Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 1 billion as compared to Rs 1 billion in FY22, thereby witnessing an increase of 19.6%.
• Long-term debt stood at Rs 7 million as compared to Rs 6 million during FY22, a growth of 21.7%.
• Current assets rose 24% and stood at Rs 3 billion, while fixed assets rose 9% and stood at Rs 2 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 5 billion as against Rs 4 billion during FY22, thereby witnessing a growth of 18%.

ADOR WELDING Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	2,821	3,235	14.7
Current Liabilities	Rs m	1,187	1,420	19.6
Long-term Debt	Rs m	6	7	21.7
Total Liabilities	Rs m	4,352	5,138	18.1
Current assets	Rs m	2,447	3,047	24.5
Fixed Assets	Rs m	1,905	2,084	9.4
Total Assets	Rs m	4,352	5,138	18.1

ADOR WELDING Cash Flow Statement Analysis

• ADOR WELDING's cash flow from operating activities (CFO) during FY23 stood at Rs 137 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -97 million, an improvement of 77.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -47 million, an improvement of 85% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -7 million from the Rs -104 million net cash flows seen during FY22.

ADOR WELDING Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	264	137	-48.2%
Cash Flow from Investing Activities	Rs m	-55	-97	-
Cash Flow from Financing Activities	Rs m	-314	-47	-
Net Cash Flow	Rs m	-104	-7	-

Current Valuations for ADOR WELDING

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 43.6, an improvement from the EPS of Rs 33.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,245.8, stands at 28.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.2 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 15.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	486.4	571.1
TTM Earnings per share	Rs	33.2	43.6
Diluted earnings per share	Rs	33.2	43.6
Price to Cash Flow	x	15.0	15.6
TTM P/E ratio	x	18.6	28.6
Price / Book Value ratio	x	2.8	3.4
Market Cap	Rs m	7,840	11,068
Dividends per share (Unadj.)	Rs	12.5	17.5

Ratio Analysis for ADOR WELDING

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.1x during FY23, from 2.1x during FY22. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 21.8x during FY23, from 11.0x during FY22. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at 18.3% during FY23, from 16.0% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 25.6% during FY23, from 22.6% during FY22. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company improved and stood at 12.3% during FY23, from 11.7% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	2.1	2.1
Debtors’ Days	Days	514	588
Interest coverage	x	11.0	21.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.7	12.3
Return on equity	%	16.0	18.3
Return on capital employed	%	22.6	25.6

To see how ADOR WELDING has performed over the last 5 years, please visit here.

ADOR WELDING Share Price Performance

Over the last one year, ADOR WELDING share price has moved up from Rs 776.6 to Rs 1,245.8, registering a gain of Rs 469.2 or around 60.4%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 42,401.9 (up 1.7%). Over the last one year it has moved up from 29,013.8 to 42,401.9, a gain of 13,388 points (up 46.1%).

Overall, the S&P BSE SENSEX is up 20.4% over the year.

(To know more, check out historical annual results for ADOR WELDING and quarterly results for ADOR WELDING)