ADANI ENTERPRISES 2022-23 Annual Report Analysis

Wed, 28 Jun

ADANI ENTERPRISES 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 ENTERPRISES Income Statement Analysis

• Operating income during the year rose 97.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 133.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 6.2% in FY23 as against 5.2% in FY22.
• Depreciation charges increased by 95.2% and finance costs increased by 57.2% YoY, respectively.
• Other income grew by 8.9% YoY.
• Net profit for the year grew by 364.7% YoY.
• Net profit margins during the year grew from 0.7% in FY22 to 1.6% in FY23.

ADANI ENTERPRISES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	694,202	1,369,778	97.3%
Other income	Rs m	10,993	11,974	8.9%
Total Revenues	Rs m	705,195	1,381,751	95.9%
Gross profit	Rs m	36,264	84,587	133.3%
Depreciation	Rs m	12,478	24,361	95.2%
Interest	Rs m	25,259	39,700	57.2%
Profit before tax	Rs m	9,521	32,499	241.4%
Tax	Rs m	4,767	10,410	118.4%
Profit after tax	Rs m	4,754	22,089	364.7%
Gross profit margin	%	5.2	6.2
Effective tax rate	%	50.1	32.0
Net profit margin	%	0.7	1.6

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ADANI ENTERPRISES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 448 billion as compared to Rs 438 billion in FY22, thereby witnessing an increase of 2.2%.
• Long-term debt stood at Rs 326 billion as compared to Rs 214 billion during FY22, a growth of 52.0%.
• Current assets rose 20% and stood at Rs 370 billion, while fixed assets rose 47% and stood at Rs 1,042 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 1,413 billion as against Rs 1,016 billion during FY22, thereby witnessing a growth of 39%.

ADANI ENTERPRISES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	216,165	330,510	52.9
Current Liabilities	Rs m	438,498	448,031	2.2
Long-term Debt	Rs m	214,434	325,900	52.0
Total Liabilities	Rs m	1,015,864	1,412,785	39.1
Current assets	Rs m	309,454	370,217	19.6
Fixed Assets	Rs m	706,410	1,041,568	47.4
Total Assets	Rs m	1,015,864	1,412,785	39.1

ADANI ENTERPRISES Cash Flow Statement Analysis

• ADANI ENTERPRISES's cash flow from operating activities (CFO) during FY23 stood at Rs 176 billion, an improvement of 1,172.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -169 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -12 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 10 billion from the Rs 2 billion net cash flows seen during FY22.

ADANI ENTERPRISES 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	13,853	176,265	1,172.4%
Cash Flow from Investing Activities	Rs m	-174,874	-168,601	-
Cash Flow from Financing Activities	Rs m	159,014	-11,975	-
Net Cash Flow	Rs m	2,461	9,701	294.2%

Current Valuations for ADANI ENTERPRISES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.4, an improvement from the EPS of Rs 4.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,281.8, stands at 117.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.9 times, while the price to sales ratio stands at 1.9 times.
• The company's price to cash flow (P/CF) ratio stood at 63.9 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	631.2	1,201.6
TTM Earnings per share	Rs	4.3	19.4
Diluted earnings per share	Rs	4.2	19.4
Price to Cash Flow	x	133.4	63.9
TTM P/E ratio	x	483.4	117.8
Price / Book Value ratio	x	7.8	9.0
Market Cap	Rs m	1,692,140	2,967,793
Dividends per share (Unadj.)	Rs	1.0	1.2

Ratio Analysis for ADANI ENTERPRISES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.8x during FY23, from 0.7x 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 1.8x during FY23, from 1.4x 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 6.7% during FY23, from 2.2% 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 11.0% during FY23, from 8.1% 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 4.4% during FY23, from 3.0% 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	0.7	0.8
Debtors’ Days	Days	7	3
Interest coverage	x	1.4	1.8
Debt to equity ratio	x	1.0	1.0
Return on assets	%	3.0	4.4
Return on equity	%	2.2	6.7
Return on capital employed	%	8.1	11.0

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 2,205.0 to Rs 2,281.8, registering a gain of Rs 76.8 or around 3.5%.

Overall, the S&P BSE SENSEX is up 19.3% over the year.

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