ACTION CONST. 2022-23 Annual Report Analysis

Thu, 26 Oct

ACTION CONST. 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.

ACTION CONST. Income Statement Analysis

• Operating income during the year rose 32.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 45.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 10.2% in FY23 as against 9.3% in FY22.
• Depreciation charges increased by 16.8% and finance costs increased by 8.1% YoY, respectively.
• Other income grew by 281.3% YoY.
• Net profit for the year grew by 64.7% YoY.
• Net profit margins during the year grew from 6.4% in FY22 to 8.0% in FY23.

ACTION CONST. Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	16,296	21,597	32.5%
Other income	Rs m	108	411	281.3%
Total Revenues	Rs m	16,404	22,008	34.2%
Gross profit	Rs m	1,514	2,209	45.9%
Depreciation	Rs m	154	180	16.8%
Interest	Rs m	95	103	8.1%
Profit before tax	Rs m	1,373	2,337	70.2%
Tax	Rs m	323	608	88.1%
Profit after tax	Rs m	1,050	1,730	64.7%
Gross profit margin	%	9.3	10.2
Effective tax rate	%	23.5	26.0
Net profit margin	%	6.4	8.0

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ACTION CONST. Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 7 billion as compared to Rs 5 billion in FY22, thereby witnessing an increase of 29.7%.
• Current assets rose 30% and stood at Rs 9 billion, while fixed assets rose 19% and stood at Rs 7 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 16 billion as against Rs 13 billion during FY22, thereby witnessing a growth of 25%.

ACTION CONST. Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	7,541	9,186	21.8
Current Liabilities	Rs m	5,110	6,629	29.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	12,824	15,997	24.7
Current assets	Rs m	7,028	9,115	29.7
Fixed Assets	Rs m	5,796	6,883	18.8
Total Assets	Rs m	12,824	15,997	24.7

ACTION CONST. Cash Flow Statement Analysis

• ACTION CONST.'s cash flow from operating activities (CFO) during FY23 stood at Rs 3 billion, an improvement of 165.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion, an improvement of 8.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -410 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 158 million from the Rs -272 million net cash flows seen during FY22.

ACTION CONST. 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	1,035	2,743	165.0%
Cash Flow from Investing Activities	Rs m	-2,015	-2,175	-
Cash Flow from Financing Activities	Rs m	708	-410	-
Net Cash Flow	Rs m	-272	158	-

Current Valuations for ACTION CONST.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 14.5, an improvement from the EPS of Rs 8.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 716.8, stands at 43.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.3 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 18.2 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	136.8	181.4
TTM Earnings per share	Rs	8.8	14.5
Diluted earnings per share	Rs	8.8	14.5
Price to Cash Flow	x	23.8	18.2
TTM P/E ratio	x	27.3	43.7
Price / Book Value ratio	x	3.4	3.8
Market Cap	Rs m	25,674	34,772
Dividends per share (Unadj.)	Rs	0.6	1.0

Ratio Analysis for ACTION CONST.

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.4x during FY23, from 1.4x 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 23.7x during FY23, from 15.4x 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 18.8% during FY23, from 13.9% 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 26.6% during FY23, from 19.5% 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 11.5% during FY23, from 8.9% 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	1.4	1.4
Debtors’ Days	Days	423	286
Interest coverage	x	15.4	23.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	8.9	11.5
Return on equity	%	13.9	18.8
Return on capital employed	%	19.5	26.6

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

ACTION CONST. Share Price Performance

Over the last one year, ACTION CONST. share price has moved up from Rs 288.6 to Rs 716.8, registering a gain of Rs 428.2 or around 148.4%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 45,117.4 (down 1.1%). Over the last one year it has moved up from 32,580.4 to 45,117.4, a gain of 12,537 points (up 38.5%).

Overall, the S&P BSE SENSEX is up 5.6% over the year.

(To know more, check out historical annual results for ACTION CONST. and quarterly results for ACTION CONST.)