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GARWARE TECHNICAL 2022-23 Annual Report Analysis

Fri, 1 Sep

GARWARE TECHNICAL 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.

GARWARE TECHNICAL Income Statement Analysis

• Operating income during the year rose 9.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 5.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 16.6% in FY23 as against 17.3% in FY22.
• Depreciation charges increased by 4.0% and finance costs increased by 13.1% YoY, respectively.
• Other income declined by 5.5% YoY.
• Net profit for the year grew by 4.5% YoY.
• Net profit margins during the year declined from 13.9% in FY22 to 13.2% in FY23.

GARWARE TECHNICAL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	11,894	13,055	9.8%
Other income	Rs m	424	401	-5.5%
Total Revenues	Rs m	12,318	13,457	9.2%
Gross profit	Rs m	2,060	2,173	5.5%
Depreciation	Rs m	215	223	4.0%
Interest	Rs m	106	120	13.1%
Profit before tax	Rs m	2,164	2,232	3.1%
Tax	Rs m	516	510	-1.3%
Profit after tax	Rs m	1,648	1,722	4.5%
Gross profit margin	%	17.3	16.6
Effective tax rate	%	23.9	22.8
Net profit margin	%	13.9	13.2

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GARWARE TECHNICAL Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 4 billion as compared to Rs 4 billion in FY22, thereby witnessing an increase of 8.5%.
• Current assets fell 25% and stood at Rs 6 billion, while fixed assets rose 47% and stood at Rs 9 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 15 billion as against Rs 14 billion during FY22, thereby witnessing a growth of 6%.

GARWARE TECHNICAL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	9,706	10,164	4.7
Current Liabilities	Rs m	3,971	4,309	8.5
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	14,151	14,932	5.5
Current assets	Rs m	8,138	6,098	-25.1
Fixed Assets	Rs m	6,012	8,834	46.9
Total Assets	Rs m	14,151	14,932	5.5

GARWARE TECHNICAL Cash Flow Statement Analysis

• GARWARE TECHNICAL's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 196.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -851 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 26 million from the Rs 337 million net cash flows seen during FY22.

GARWARE TECHNICAL 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	638	1,894	196.6%
Cash Flow from Investing Activities	Rs m	79	-1,017	-
Cash Flow from Financing Activities	Rs m	-380	-851	-
Net Cash Flow	Rs m	337	26	-92.4%

Current Valuations for GARWARE TECHNICAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 84.5, an improvement from the EPS of Rs 79.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,198.3, stands at 34.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.4 times, while the price to sales ratio stands at 5.0 times.
• The company's price to cash flow (P/CF) ratio stood at 33.2 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	576.8	640.6
TTM Earnings per share	Rs	79.9	84.5
Diluted earnings per share	Rs	80.9	84.5
Price to Cash Flow	x	31.0	33.2
TTM P/E ratio	x	35.0	34.9
Price / Book Value ratio	x	6.9	6.4
Market Cap	Rs m	67,281	64,594
Dividends per share (Unadj.)	Rs	7.0	3.5

Ratio Analysis for GARWARE TECHNICAL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.4x during FY23, from 2.0x 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 deteriorated and stood at 19.7x during FY23, from 21.5x 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 declined and down at 16.9% during FY23, from 17.0% 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 declined and down at 23.1% during FY23, from 23.4% 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 declined and down at 12.3% during FY23, from 12.4% 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	2.0	1.4
Debtors’ Days	Days	792	654
Interest coverage	x	21.5	19.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.4	12.3
Return on equity	%	17.0	16.9
Return on capital employed	%	23.4	23.1

To see how GARWARE TECHNICAL has performed over the last 5 years, please visit here.

GARWARE TECHNICAL Share Price Performance

Over the last one year, GARWARE TECHNICAL share price has moved down from Rs 3,437.5 to Rs 3,198.3, registering a loss of Rs 239.2 or around 7.0%.

Overall, the S&P BSE SENSEX is up 8.9% over the year.

(To know more, check out historical annual results for GARWARE TECHNICAL and quarterly results for GARWARE TECHNICAL)