AARTI SURFACTANTS 2020-21 Annual Report Analysis

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AARTI SURFACTANTS 2020-21 Annual Report Analysis
Wed, 27 Oct

AARTI SURFACTANTS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

AARTI SURFACTANTS Income Statement Analysis

  • Operating income during the year rose 42.9% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 92.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 9.8% in FY21 as against 7.2% in FY20.
  • Depreciation charges increased by 15.5% and finance costs increased by 1.6% YoY, respectively.
  • Other income declined by 71.8% YoY.
  • Net profit for the year grew by 937.2% YoY.
  • Net profit margins during the year grew from 0.6% in FY20 to 4.6% in FY21.

AARTI SURFACTANTS Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 3,259 4,658 42.9%
Other income Rs m 2 1 -71.8%
Total Revenues Rs m 3,261 4,658 42.9%
Gross profit Rs m 236 455 92.9%
Depreciation Rs m 106 122 15.5%
Interest Rs m 103 104 1.6%
Profit before tax Rs m 29 229 678.1%
Tax Rs m 9 13 49.0%
Profit after tax Rs m 21 216 937.2%
Gross profit margin % 7.2 9.8
Effective tax rate % 29.2 5.6
Net profit margin % 0.6 4.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



ALERT: Top Investment Recommendation for 2022

AARTI SURFACTANTS Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 2 billion as compared to Rs 949 million in FY20, thereby witnessing an increase of 61.8%.
  • Long-term debt stood at Rs 887 million as compared to Rs 488 million during FY20, a growth of 81.8%.
  • Current assets rose 83% and stood at Rs 2 billion, while fixed assets rose 26% and stood at Rs 2 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 4 billion as against Rs 3 billion during FY20, thereby witnessing a growth of 46%.

AARTI SURFACTANTS Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 1,110 1,327 19.6
 
Current Liabilities Rs m 949 1,536 61.8
Long-term Debt Rs m 488 887 81.8
Total Liabilities Rs m 2,623 3,839 46.4
 
Current assets Rs m 944 1,728 83.1
Fixed Assets Rs m 1,679 2,111 25.7
Total Assets Rs m 2,623 3,839 46.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



AARTI SURFACTANTS Cash Flow Statement Analysis

  • AARTI SURFACTANTS's cash flow from operating activities (CFO) during FY21 stood at Rs 358 million, an improvement of 97.8% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -615 million, an improvement of 2,761.2% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs 323 million, an improvement of 303% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 66 million from the Rs 1 million net cash flows seen during FY20.

AARTI SURFACTANTS Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m 181 358 97.8%
Cash Flow from Investing Activities Rs m -21 -615 -
Cash Flow from Financing Activities Rs m -159 323 -
Net Cash Flow Rs m 1 66 7,697.6%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for AARTI SURFACTANTS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 28.5, an improvement from the EPS of Rs 2.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,261.0, stands at 44.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 4.1 times, while the price to sales ratio stands at 1.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 28.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 429.9 614.5
TTM Earnings per share Rs 2.8 28.5
Diluted earnings per share Rs 2.8 28.5
Price to Cash Flow x 75.5 28.3
TTM P/E ratio x 44.3 44.3
Price / Book Value ratio x 0.0 4.1
Market Cap Rs m 9,564 9,564
Dividends per share (Unadj.) Rs 0.0 3.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for AARTI SURFACTANTS

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.1x during FY21, from 1.0x during FY20. 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 3.2x during FY21, from 1.3x during FY20. 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 16.3% during FY21, from 1.9% during FY21. 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 15.1% during FY21, from 8.3% during FY20. 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 8.4% during FY21, from 4.7% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 1.0 1.1
Debtors’ Days Days 201 427
Interest coverage x 1.3 3.2
Debt to equity ratio x 0.4 0.7
Return on assets % 4.7 8.4
Return on equity % 1.9 16.3
Return on capital employed % 8.3 15.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how AARTI SURFACTANTS has performed over the last 5 years, please visit here.

AARTI SURFACTANTS Share Price Performance

Over the last one year, AARTI SURFACTANTS share price has moved up from Rs 555.0 to Rs 1,261.0, registering a gain of Rs 706.0 or around 127.2%.

Overall, the S&P BSE SENSEX is up 52.3% over the year.

(To know more, check out historical annual results for AARTI SURFACTANTS and quarterly results for AARTI SURFACTANTS)

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