ADANI ENTERPRISES 2020-21 Annual Report Analysis

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ADANI ENTERPRISES 2020-21 Annual Report Analysis
Thu, 8 Jul

ADANI ENTERPRISES 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.

ADANI ENTERPRISES Income Statement Analysis

  • Operating income during the year fell 8.9% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 9.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 5.7% in FY21 as against 5.7% in FY20.
  • Depreciation charges increased by 13.8% and finance costs decreased by 12.4% YoY, respectively.
  • Other income grew by 10.3% YoY.
  • Net profit for the year declined by 6.5% YoY.
  • Net profit margins during the year grew from 1.8% in FY20 to 1.9% in FY21.

ADANI ENTERPRISES Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 434,026 395,371 -8.9%
Other income Rs m 6,837 7,538 10.3%
Total Revenues Rs m 440,862 402,909 -8.6%
Gross profit Rs m 24,831 22,462 -9.5%
Depreciation Rs m 4,721 5,371 13.8%
Interest Rs m 15,723 13,769 -12.4%
Profit before tax Rs m 11,223 10,860 -3.2%
Tax Rs m 3,243 3,397 4.7%
Profit after tax Rs m 7,980 7,463 -6.5%
Gross profit margin % 5.7 5.7
Effective tax rate % 28.9 31.3
Net profit margin % 1.8 1.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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ADANI ENTERPRISES Balance Sheet Analysis

  • The company's current liabilities during FY21 down at Rs 215 billion as compared to Rs 233 billion in FY20, thereby witnessing an decrease of -7.8%.
  • Long-term debt stood at Rs 95 billion as compared to Rs 35 billion during FY20, a growth of 170.9%.
  • Current assets fell 17% and stood at Rs 200 billion, while fixed assets rose 41% and stood at Rs 316 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 516 billion as against Rs 466 billion during FY20, thereby witnessing a growth of 11%.

ADANI ENTERPRISES Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 169,466 171,586 1.3
 
Current Liabilities Rs m 232,889 214,831 -7.8
Long-term Debt Rs m 35,158 95,233 170.9
Total Liabilities Rs m 466,256 515,663 10.6
 
Current assets Rs m 241,829 199,633 -17.4
Fixed Assets Rs m 224,427 316,030 40.8
Total Assets Rs m 466,256 515,663 10.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



ADANI ENTERPRISES Cash Flow Statement Analysis

  • ADANI ENTERPRISES's cash flow from operating activities (CFO) during FY21 stood at Rs 41 billion, an improvement of 66.8% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -79 billion, an improvement of 240.2% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs 31 billion, an improvement of 1,485% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -15 billion from the Rs 12 billion net cash flows seen during FY20.

ADANI ENTERPRISES 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 24,536 40,935 66.8%
Cash Flow from Investing Activities Rs m -23,230 -79,024 -
Cash Flow from Financing Activities Rs m -2,209 30,586 -
Net Cash Flow Rs m 11,508 -14,585 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for ADANI ENTERPRISES

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.8, an decline from the EPS of Rs 7.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,420.3, stands at 209.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.9 times, while the price to sales ratio stands at 1.7 times.
  • The company's price to cash flow (P/CF) ratio stood at 121.7 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 394.6 359.5
TTM Earnings per share Rs 7.3 6.8
Diluted earnings per share Rs 7.3 6.8
Price to Cash Flow x 123.0 121.7
TTM P/E ratio x 209.3 209.3
Price / Book Value ratio x 1.2 3.9
Market Cap Rs m 1,562,060 1,562,060
Dividends per share (Unadj.) Rs 1.0 1.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for ADANI ENTERPRISES

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 0.9x 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 1.8x during FY21, from 1.7x 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 declined and down at 4.3% during FY21, from 4.7% 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 declined and down at 9.2% during FY21, from 13.2% 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 declined and down at 4.1% during FY21, from 5.1% 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 0.9
Debtors’ Days Days 111 111
Interest coverage x 1.7 1.8
Debt to equity ratio x 0.2 0.6
Return on assets % 5.1 4.1
Return on equity % 4.7 4.3
Return on capital employed % 13.2 9.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

ADANI ENTERPRISES Share Price Performance

Over the last one year, ADANI ENTERPRISES share price has moved up from Rs 163.1 to Rs 1,420.3, registering a gain of Rs 1,257.3 or around 771.1%.

Overall, the S&P BSE SENSEX is up 43.9% over the year.

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

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