Markets will remain closed on May 20, 2024 on account of Parliamentary Elections.

EUREKA FORBES 2022-23 Annual Report Analysis

Wed, 27 Sep

EUREKA FORBES 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.

EUREKA FORBES Income Statement Analysis

• Operating income during the year rose 446.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 493.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 5.0% in FY23 as against 4.6% in FY22.
• Depreciation charges increased by 515.0% and finance costs increased by 358.3% YoY, respectively.
• Other income grew by 243.4% YoY.
• Net profit for the year grew by 912.3% YoY.
• Net profit margins during the year grew from 0.7% in FY22 to 1.3% in FY23.

EUREKA FORBES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	3,818	20,845	446.0%
Other income	Rs m	30	102	243.4%
Total Revenues	Rs m	3,847	20,947	444.5%
Gross profit	Rs m	177	1,050	493.7%
Depreciation	Rs m	92	565	515.0%
Interest	Rs m	44	203	358.3%
Profit before tax	Rs m	71	385	445.3%
Tax	Rs m	44	120	170.7%
Profit after tax	Rs m	26	265	912.3%
Gross profit margin	%	4.6	5.0
Effective tax rate	%	63.0	31.3
Net profit margin	%	0.7	1.3

India's Capex Comeback: Explore Small Cap Stock Opportunities

EUREKA FORBES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 10 billion as compared to Rs 10 billion in FY22, thereby witnessing an decrease of -7.3%.
• Long-term debt down at Rs 247 million as compared to Rs 496 million during FY22, a fall of 50.1%.
• Current assets fell 12% and stood at Rs 5 billion, while fixed assets fell 1% and stood at Rs 55 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 60 billion as against Rs 61 billion during FY22, thereby witnessing a fall of 2%.

EUREKA FORBES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	40,761	40,976	0.5
Current Liabilities	Rs m	10,300	9,550	-7.3
Long-term Debt	Rs m	496	247	-50.1
Total Liabilities	Rs m	61,266	60,293	-1.6
Current assets	Rs m	5,646	4,969	-12.0
Fixed Assets	Rs m	55,620	55,324	-0.5
Total Assets	Rs m	61,266	60,293	-1.6

EUREKA FORBES Cash Flow Statement Analysis

• EUREKA FORBES's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 391.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -263 million, an improvement of 604.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 8 million from the Rs 176 million net cash flows seen during FY22.

EUREKA FORBES 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	367	1,806	391.7%
Cash Flow from Investing Activities	Rs m	-37	-263	-
Cash Flow from Financing Activities	Rs m	-314	-1,535	-
Net Cash Flow	Rs m	176	8	-95.5%

Current Valuations for EUREKA FORBES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 1.4, an improvement from the EPS of Rs 0.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 497.0, stands at 299.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.3 times, while the price to sales ratio stands at 4.6 times.
• The company's price to cash flow (P/CF) ratio stood at 95.5 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	19.7	107.7
TTM Earnings per share	Rs	0.1	1.4
Diluted earnings per share	Rs	0.1	1.4
Price to Cash Flow	x	641.8	95.5
TTM P/E ratio	x	2,895.2	299.4
Price / Book Value ratio	x	2.0	1.9
Market Cap	Rs m	82,538	79,235
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for EUREKA FORBES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.5x during FY23, from 0.5x 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 2.9x during FY23, from 2.6x 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 0.6% during FY23, from 0.1% 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 1.4% during FY23, from 0.3% 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 0.8% during FY23, from 0.1% 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	0.5	0.5
Debtors’ Days	Days	1,437	217
Interest coverage	x	2.6	2.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	0.1	0.8
Return on equity	%	0.1	0.6
Return on capital employed	%	0.3	1.4

To see how EUREKA FORBES has performed over the last 5 years, please visit here.

EUREKA FORBES Share Price Performance

Over the last one year, EUREKA FORBES share price has moved down from Rs 500.4 to Rs 497.0, registering a loss of Rs 3.4 or around 0.7%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 45,868.5 (down 0.4%). Over the last one year it has moved up from 41,812.4 to 45,868.5, a gain of 4,056 points (up 9.7%).

Overall, the S&P BSE SENSEX is up 15.6% over the year.

(To know more, check out historical annual results for EUREKA FORBES and quarterly results for EUREKA FORBES)