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ACKNIT INDUSTRIES 2022-23 Annual Report Analysis

Sun, 9 Jul

ACKNIT INDUSTRIES 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.

ACKNIT INDUSTRIES Income Statement Analysis

• Operating income during the year rose 10.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 16.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 7.8% in FY23 as against 7.3% in FY22.
• Depreciation charges increased by 7.7% and finance costs increased by 6.3% YoY, respectively.
• Other income declined by 94.2% YoY.
• Net profit for the year grew by 13.6% YoY.
• Net profit margins during the year grew from 3.7% in FY22 to 3.8% in FY23.

ACKNIT INDUSTRIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	2,157	2,385	10.6%
Other income	Rs m	12	1	-94.2%
Total Revenues	Rs m	2,168	2,385	10.0%
Gross profit	Rs m	158	185	16.9%
Depreciation	Rs m	31	33	7.7%
Interest	Rs m	29	31	6.3%
Profit before tax	Rs m	110	121	10.5%
Tax	Rs m	30	31	2.3%
Profit after tax	Rs m	79	90	13.6%
Gross profit margin	%	7.3	7.8
Effective tax rate	%	27.7	25.7
Net profit margin	%	3.7	3.8

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ACKNIT INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 596 million as compared to Rs 794 million in FY22, thereby witnessing an decrease of -25.0%.
• Long-term debt down at Rs 2 million as compared to Rs 35 million during FY22, a fall of 93.2%.
• Current assets fell 13% and stood at Rs 927 million, while fixed assets fell 2% and stood at Rs 399 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 1 billion as against Rs 1 billion during FY22, thereby witnessing a fall of 10%.

ACKNIT INDUSTRIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	617	704	14.0
Current Liabilities	Rs m	794	596	-25.0
Long-term Debt	Rs m	35	2	-93.2
Total Liabilities	Rs m	1,471	1,326	-9.9
Current assets	Rs m	1,064	927	-12.9
Fixed Assets	Rs m	407	399	-2.0
Total Assets	Rs m	1,471	1,326	-9.9

ACKNIT INDUSTRIES Cash Flow Statement Analysis

• ACKNIT INDUSTRIES 's cash flow from operating activities (CFO) during FY23 stood at Rs 254 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -30 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -223 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 1 million from the Rs -2 million net cash flows seen during FY22.

ACKNIT INDUSTRIES 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	-76	254	-
Cash Flow from Investing Activities	Rs m	-63	-30	-
Cash Flow from Financing Activities	Rs m	137	-223	-
Net Cash Flow	Rs m	-2	1	-

Current Valuations for ACKNIT INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 29.7, an improvement from the EPS of Rs 26.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 208.0, stands at 7.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.9 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at 3.9 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	709.4	784.4
TTM Earnings per share	Rs	26.1	29.7
Diluted earnings per share	Rs	26.1	29.7
Price to Cash Flow	x	3.7	3.9
TTM P/E ratio	x	5.2	7.0
Price / Book Value ratio	x	0.6	0.7
Market Cap	Rs m	351	487
Dividends per share (Unadj.)	Rs	1.5	1.5

Ratio Analysis for ACKNIT INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY23, from 1.3x 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 4.9x during FY23, from 4.8x 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 12.8% during FY23, from 12.9% 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 21.6% during FY23, from 21.3% 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 9.1% during FY23, from 7.4% 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	1.3	1.6
Debtors’ Days	Days	522	435
Interest coverage	x	4.8	4.9
Debt to equity ratio	x	0.1	0.0
Return on assets	%	7.4	9.1
Return on equity	%	12.9	12.8
Return on capital employed	%	21.3	21.6

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

ACKNIT INDUSTRIES Share Price Performance

Over the last one year, ACKNIT INDUSTRIES share price has moved up from Rs 143.5 to Rs 208.0, registering a gain of Rs 64.5 or around 44.9%.

Overall, the S&P BSE SENSEX is up 22.9% over the year.

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