ACC 2019-20 Annual Report Analysis

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ACC 2019-20 Annual Report Analysis
Mon, 9 Aug

ACC has announced its results for the year ended December 2020. Let us have a look at the detailed performance review of the company during FY19-20.

ACC Income Statement Analysis

  • Operating income during the year fell 12.0% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 9.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 15.8% in CY20 as against 15.4% in CY19.
  • Depreciation charges increased by 5.3% and finance costs decreased by 33.8% YoY, respectively.
  • Other income declined by 32.1% YoY.
  • Net profit for the year grew by 4.2% YoY.
  • Net profit margins during the year grew from 8.5% in CY19 to 10.1% in CY20.

ACC Income Statement 2019-20

No. of Mths Year Ending 12 Dec-19* 12 Dec-20* % Change
Net Sales Rs m 156,576 137,860 -12.0%
Other income Rs m 3,208 2,178 -32.1%
Total Revenues Rs m 159,783 140,037 -12.4%
Gross profit Rs m 24,105 21,781 -9.6%
Depreciation Rs m 6,064 6,388 5.3%
Interest Rs m 863 571 -33.8%
Profit before tax Rs m 20,385 16,999 -16.6%
Tax Rs m 6,750 2,786 -58.7%
Profit after tax Rs m 13,635 14,213 4.2%
Gross profit margin % 15.4 15.8
Effective tax rate % 33.1 16.4
Net profit margin % 8.5 10.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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ACC Balance Sheet Analysis

  • The company's current liabilities during CY20 stood at Rs 48 billion as compared to Rs 47 billion in CY19, thereby witnessing an increase of 2.3%.
  • Current assets rose 12% and stood at Rs 84 billion, while fixed assets rose 2% and stood at Rs 98 billion in CY20.
  • Overall, the total assets and liabilities for CY20 stood at Rs 182 billion as against Rs 171 billion during CY19, thereby witnessing a growth of 6%.

ACC Balance Sheet as on December 2020

No. of Mths Year Ending 12 Dec-19* 12 Dec-20* % Change
Networth Rs m 115,438 126,991 10.0
 
Current Liabilities Rs m 46,982 48,043 2.3
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 171,360 182,002 6.2
 
Current assets Rs m 75,346 84,486 12.1
Fixed Assets Rs m 96,014 97,516 1.6
Total Assets Rs m 171,360 182,002 6.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



ACC Cash Flow Statement Analysis

  • ACC 's cash flow from operating activities (CFO) during CY20 stood at Rs 22 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during CY20 stood at Rs -5 billion, an improvement of 66.4% on a YoY basis.
  • Cash flow from financial activities (CFF) during CY20 stood at Rs -3 billion, an improvement of 13% on a YoY basis.
  • Overall, net cash flows for the company during CY20 stood at Rs 14 billion from the Rs 16 billion net cash flows seen during CY19.

ACC Cash Flow Statement 2019-20

Particulars No. of months 12 12 % Change
Year Ending Dec-19 Dec-20
Cash Flow from Operating Activities Rs m 22,547 22,192 -1.6%
Cash Flow from Investing Activities Rs m -3,217 -5,352 -
Cash Flow from Financing Activities Rs m -3,742 -3,274 -
Net Cash Flow Rs m 15,593 13,568 -13.0%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for ACC

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 75.7, an improvement from the EPS of Rs 72.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 2,340.4, stands at 22.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 1.8 times.
  • The company's price to cash flow (P/CF) ratio stood at 21.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Dec-19* 12 Dec-20*
Sales per share (Unadj.) Rs 833.8 734.1
TTM Earnings per share Rs 72.6 75.7
Diluted earnings per share Rs 72.6 75.7
Price to Cash Flow x 22.3 21.3
TTM P/E ratio x 22.5 22.5
Price / Book Value ratio x 2.5 2.0
Market Cap Rs m 439,497 439,497
Dividends per share (Unadj.) Rs 14.0 14.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for ACC

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.8x during CY20, from 1.6x during CY19. 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 30.8x during CY20, from 24.6x during CY19. 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 11.2% during CY20, from 11.8% during CY20. 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 13.8% during CY20, from 18.4% during CY19. 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 8.1% during CY20, from 8.5% during CY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Dec-19* 12 Dec-20*
Current ratio x 1.6 1.8
Debtors’ Days Days 1 1
Interest coverage x 24.6 30.8
Debt to equity ratio x 0.0 0.0
Return on assets % 8.5 8.1
Return on equity % 11.8 11.2
Return on capital employed % 18.4 13.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

ACC Share Price Performance

Over the last one year, ACC share price has moved up from Rs 1,396.8 to Rs 2,340.4, registering a gain of Rs 943.6 or around 67.6%.

Overall, the S&P BSE SENSEX is up 44.4% over the year.

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

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