ADANI TRANSMISSION 2022-23 Annual Report Analysis

Fri, 30 Jun

ADANI TRANSMISSION 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.

ADANI TRANSMISSION Income Statement Analysis

• Operating income during the year rose 18.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 7.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 34.0% in FY23 as against 37.4% in FY22.
• Depreciation charges increased by 12.7% and finance costs increased by 17.6% YoY, respectively.
• Other income grew by 23.1% YoY.
• Net profit for the year grew by 3.6% YoY.
• Net profit margins during the year declined from 11.0% in FY22 to 9.6% in FY23.

ADANI TRANSMISSION Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	112,575	132,927	18.1%
Other income	Rs m	12,864	15,833	23.1%
Total Revenues	Rs m	125,439	148,760	18.6%
Gross profit	Rs m	42,062	45,176	7.4%
Depreciation	Rs m	14,272	16,077	12.7%
Interest	Rs m	23,650	27,815	17.6%
Profit before tax	Rs m	17,005	17,117	0.7%
Tax	Rs m	4,647	4,311	-7.2%
Profit after tax	Rs m	12,358	12,806	3.6%
Gross profit margin	%	37.4	34.0
Effective tax rate	%	27.3	25.2
Net profit margin	%	11.0	9.6

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ADANI TRANSMISSION Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 70 billion as compared to Rs 59 billion in FY22, thereby witnessing an increase of 18.4%.
• Long-term debt stood at Rs 313 billion as compared to Rs 308 billion during FY22, a growth of 1.6%.
• Current assets rose 63% and stood at Rs 89 billion, while fixed assets rose 7% and stood at Rs 450 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 539 billion as against Rs 475 billion during FY22, thereby witnessing a growth of 14%.

ADANI TRANSMISSION Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	68,572	116,624	70.1
Current Liabilities	Rs m	59,282	70,173	18.4
Long-term Debt	Rs m	308,297	313,304	1.6
Total Liabilities	Rs m	474,641	539,318	13.6
Current assets	Rs m	54,777	89,069	62.6
Fixed Assets	Rs m	419,864	450,249	7.2
Total Assets	Rs m	474,641	539,318	13.6

ADANI TRANSMISSION Cash Flow Statement Analysis

• ADANI TRANSMISSION's cash flow from operating activities (CFO) during FY23 stood at Rs 38 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -47 billion, an improvement of 19.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 9 billion, an improvement of 493% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 16 million from the Rs -746 million net cash flows seen during FY22.

ADANI TRANSMISSION 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	40,966	37,770	-7.8%
Cash Flow from Investing Activities	Rs m	-39,480	-46,987	-
Cash Flow from Financing Activities	Rs m	-2,349	9,232	-
Net Cash Flow	Rs m	-746	16	-

Current Valuations for ADANI TRANSMISSION

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.5, an improvement from the EPS of Rs 11.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 775.8, stands at 67.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.4 times, while the price to sales ratio stands at 6.5 times.
• The company's price to cash flow (P/CF) ratio stood at 94.0 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	102.4	119.2
TTM Earnings per share	Rs	11.2	11.5
Diluted earnings per share	Rs	11.1	11.5
Price to Cash Flow	x	99.4	94.0
TTM P/E ratio	x	209.3	67.8
Price / Book Value ratio	x	27.6	23.3
Market Cap	Rs m	1,890,656	2,715,416
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for ADANI TRANSMISSION

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x 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 deteriorated and stood at 1.6x during FY23, from 1.7x 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 11.0% during FY23, from 18.0% 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 declined and down at 10.5% during FY23, from 10.8% 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 declined and down at 7.5% during FY23, from 7.6% 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	1.3
Debtors’ Days	Days	3	4
Interest coverage	x	1.7	1.6
Debt to equity ratio	x	4.5	2.7
Return on assets	%	7.6	7.5
Return on equity	%	18.0	11.0
Return on capital employed	%	10.8	10.5

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

ADANI TRANSMISSION Share Price Performance

Over the last one year, ADANI TRANSMISSION share price has moved down from Rs 2,473.8 to Rs 775.8, registering a loss of Rs 1,698.0 or around 68.6%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 4,002.6 (up 0.0%). Over the last one year it has moved down from 4,067.0 to 4,002.6, a loss of 64 points (down 1.6%).

Overall, the S&P BSE SENSEX is up 21.3% over the year.

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