TATA TELESERVICES 2022-23 Annual Report Analysis

Sat, 3 Jun

TATA TELESERVICES 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.

TATA TELESERVICES Income Statement Analysis

• Operating income during the year rose 1.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 4.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 44.0% in FY23 as against 42.8% in FY22.
• Depreciation charges decreased by 8.1% and finance costs decreased by 2.5% YoY, respectively.
• Other income declined by 0.9% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 111.1% in FY22 to 103.5% in FY23.

TATA TELESERVICES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	10,938	11,062	1.1%
Other income	Rs m	169	168	-0.9%
Total Revenues	Rs m	11,107	11,229	1.1%
Gross profit	Rs m	4,676	4,872	4.2%
Depreciation	Rs m	1,602	1,472	-8.1%
Interest	Rs m	15,393	15,016	-2.5%
Profit before tax	Rs m	-12,150	-11,447	NA
Tax	Rs m	0	0	0.0
Profit after tax	Rs m	-12,150	-11,447	NA
Gross profit margin	%	42.8	44.0
Effective tax rate	%	0.0	0.0
Net profit margin	%	-111.1	-103.5

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TATA TELESERVICES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 102 billion as compared to Rs 94 billion in FY22, thereby witnessing an increase of 8.5%.
• Long-term debt down at Rs 100 billion as compared to Rs 107 billion during FY22, a fall of 6.4%.
• Current assets fell 28% and stood at Rs 3 billion, while fixed assets fell 5% and stood at Rs 9 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 12 billion as against Rs 14 billion during FY22, thereby witnessing a fall of 11%.

TATA TELESERVICES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	-188,325	-190,545	NA
Current Liabilities	Rs m	94,234	102,214	8.5
Long-term Debt	Rs m	107,108	100,271	-6.4
Total Liabilities	Rs m	13,645	12,107	-11.3
Current assets	Rs m	3,783	2,715	-28.2
Fixed Assets	Rs m	9,863	9,393	-4.8
Total Assets	Rs m	13,645	12,107	-11.3

TATA TELESERVICES Cash Flow Statement Analysis

• TATA TELESERVICES's cash flow from operating activities (CFO) during FY23 stood at Rs 6 billion, an improvement of 5.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -662 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -5 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -25 million from the Rs -263 million net cash flows seen during FY22.

TATA TELESERVICES 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	5,301	5,581	5.3%
Cash Flow from Investing Activities	Rs m	-1,295	-662	-
Cash Flow from Financing Activities	Rs m	-4,269	-4,944	-
Net Cash Flow	Rs m	-263	-25	-

Current Valuations for TATA TELESERVICES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -5.9, an improvement from the EPS of Rs -6.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 64.9, stands at -11.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at -0.7 times, while the price to sales ratio stands at 11.5 times.
• The company's price to cash flow (P/CF) ratio stood at -25.5 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	5.6	5.7
TTM Earnings per share	Rs	-6.2	-5.9
Diluted earnings per share	Rs	-6.2	-5.9
Price to Cash Flow	x	-30.9	-25.5
TTM P/E ratio	x	-26.8	-11.1
Price / Book Value ratio	x	-1.6	-1.3
Market Cap	Rs m	294,803	253,945
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for TATA TELESERVICES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.0x during FY23, from 0.0x 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 improved and stood at 0.2x during FY23, from 0.2x 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 6.0% during FY23, from 6.5% 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 -4.0% during FY23, from -4.0% 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 29.5% during FY23, from 23.8% 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	0.0	0.0
Debtors’ Days	Days	4	4
Interest coverage	x	0.2	0.2
Debt to equity ratio	x	-0.6	-0.5
Return on assets	%	23.8	29.5
Return on equity	%	6.5	6.0
Return on capital employed	%	-4.0	-4.0

To see how TATA TELESERVICES has performed over the last 5 years, please visit here.

TATA TELESERVICES Share Price Performance

Over the last one year, TATA TELESERVICES share price has moved down from Rs 119.2 to Rs 64.9, registering a loss of Rs 54.3 or around 45.6%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 13,154.1 (down 0.4%). Over the last one year it has moved down from 13,704.2 to 13,154.1, a loss of 550 points (down 4.0%).

Overall, the S&P BSE SENSEX is up 12.9% over the year.

(To know more, check out historical annual results for TATA TELESERVICES and quarterly results for TATA TELESERVICES)