TORRENT POWER 2022-23 Annual Report Analysis

Tue, 18 Jul

TORRENT POWER 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.

TORRENT POWER Income Statement Analysis

• Operating income during the year rose 80.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 115.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.4% in FY23 as against 15.4% in FY22.
• Depreciation charges decreased by 4.0% and finance costs increased by 30.2% YoY, respectively.
• Other income grew by 24.9% YoY.
• Net profit for the year grew by 371.9% YoY.
• Net profit margins during the year grew from 3.2% in FY22 to 8.4% in FY23.

TORRENT POWER Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	142,576	256,941	80.2%
Other income	Rs m	3,250	4,059	24.9%
Total Revenues	Rs m	145,826	261,000	79.0%
Gross profit	Rs m	22,010	47,346	115.1%
Depreciation	Rs m	13,339	12,810	-4.0%
Interest	Rs m	6,282	8,182	30.2%
Profit before tax	Rs m	5,640	30,414	439.3%
Tax	Rs m	1,053	8,767	732.8%
Profit after tax	Rs m	4,587	21,647	371.9%
Gross profit margin	%	15.4	18.4
Effective tax rate	%	18.7	28.8
Net profit margin	%	3.2	8.4

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TORRENT POWER Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 69 billion as compared to Rs 61 billion in FY22, thereby witnessing an increase of 12.7%.
• Long-term debt stood at Rs 89 billion as compared to Rs 71 billion during FY22, a growth of 25.4%.
• Current assets rose 43% and stood at Rs 75 billion, while fixed assets rose 13% and stood at Rs 224 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 299 billion as against Rs 250 billion during FY22, thereby witnessing a growth of 20%.

TORRENT POWER Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	99,432	110,100	10.7
Current Liabilities	Rs m	61,477	69,300	12.7
Long-term Debt	Rs m	70,992	89,023	25.4
Total Liabilities	Rs m	249,876	298,715	19.5
Current assets	Rs m	52,258	74,528	42.6
Fixed Assets	Rs m	197,618	224,187	13.4
Total Assets	Rs m	249,876	298,715	19.5

TORRENT POWER Cash Flow Statement Analysis

• TORRENT POWER's cash flow from operating activities (CFO) during FY23 stood at Rs 35 billion, an improvement of 9.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -32 billion, an improvement of 29.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -3 billion, an improvement of 32% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -1 billion from the Rs 2 billion net cash flows seen during FY22.

TORRENT POWER 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	31,672	34,558	9.1%
Cash Flow from Investing Activities	Rs m	-24,831	-32,160	-
Cash Flow from Financing Activities	Rs m	-5,019	-3,410	-
Net Cash Flow	Rs m	1,821	-1,012	-

Current Valuations for TORRENT POWER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 45.0, an improvement from the EPS of Rs 9.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 617.3, stands at 13.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.7 times, while the price to sales ratio stands at 1.2 times.
• The company's price to cash flow (P/CF) ratio stood at 7.2 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	296.7	534.6
TTM Earnings per share	Rs	9.5	45.0
Diluted earnings per share	Rs	9.5	45.0
Price to Cash Flow	x	13.2	7.2
TTM P/E ratio	x	51.5	13.7
Price / Book Value ratio	x	2.4	2.2
Market Cap	Rs m	235,755	246,532
Dividends per share (Unadj.)	Rs	9.0	26.0

Ratio Analysis for TORRENT POWER

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY23, from 0.9x 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 4.7x during FY23, from 1.9x 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 19.7% during FY23, from 4.6% 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 19.4% during FY23, from 7.0% 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 10.0% during FY23, from 4.3% 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	0.9	1.1
Debtors’ Days	Days	4	3
Interest coverage	x	1.9	4.7
Debt to equity ratio	x	0.7	0.8
Return on assets	%	4.3	10.0
Return on equity	%	4.6	19.7
Return on capital employed	%	7.0	19.4

To see how TORRENT POWER has performed over the last 5 years, please visit here.

TORRENT POWER Share Price Performance

Over the last one year, TORRENT POWER share price has moved up from Rs 516.5 to Rs 617.3, registering a gain of Rs 100.9 or around 19.5%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 4,006.2 (up 0.6%). Over the last one year it has moved down from 4,445.4 to 4,006.2, a loss of 439 points (down 9.9%).

Overall, the S&P BSE SENSEX is up 25.0% over the year.

(To know more, check out historical annual results for TORRENT POWER and quarterly results for TORRENT POWER)