ADOR FONTECH 2021-22 Annual Report Analysis

Wed, 6 Jul

ADOR FONTECH has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

ADOR FONTECH Income Statement Analysis

• Operating income during the year rose 40.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 66.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.8% in FY22 as against 11.6% in FY21.
• Depreciation charges increased by 14.8% and finance costs decreased by 13.9% YoY, respectively.
• Other income grew by 83.7% YoY.
• Net profit for the year grew by 113.0% YoY.
• Net profit margins during the year grew from 6.7% in FY21 to 10.2% in FY22.

ADOR FONTECH Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	1,495	2,096	40.1%
Other income	Rs m	25	45	83.7%
Total Revenues	Rs m	1,520	2,141	40.9%
Gross profit	Rs m	173	289	66.6%
Depreciation	Rs m	30	34	14.8%
Interest	Rs m	4	3	-13.9%
Profit before tax	Rs m	165	297	80.3%
Tax	Rs m	64	83	29.0%
Profit after tax	Rs m	100	214	113.0%
Gross profit margin	%	11.6	13.8
Effective tax rate	%	39.0	27.9
Net profit margin	%	6.7	10.2

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ADOR FONTECH Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 343 million as compared to Rs 321 million in FY21, thereby witnessing an increase of 7.1%.
• Current assets rose 15% and stood at Rs 1 billion, while fixed assets fell 8% and stood at Rs 297 million in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 2 billion as against Rs 1 billion during FY21, thereby witnessing a growth of 10%.

ADOR FONTECH Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	1,090	1,228	12.7
Current Liabilities	Rs m	321	343	7.1
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	1,382	1,519	9.9
Current assets	Rs m	1,060	1,222	15.3
Fixed Assets	Rs m	322	297	-7.7
Total Assets	Rs m	1,382	1,519	9.9

ADOR FONTECH Cash Flow Statement Analysis

• ADOR FONTECH's cash flow from operating activities (CFO) during FY22 stood at Rs 207 million, an improvement of 121.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -103 million, an improvement of 139.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -103 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 2 million from the Rs -25 million net cash flows seen during FY21.

ADOR FONTECH Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	94	207	121.6%
Cash Flow from Investing Activities	Rs m	-43	-103	-
Cash Flow from Financing Activities	Rs m	-76	-103	-
Net Cash Flow	Rs m	-25	2	-

Current Valuations for ADOR FONTECH

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.1, an improvement from the EPS of Rs 2.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 74.7, stands at 12.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.1 times, while the price to sales ratio stands at 1.2 times.
• The company's price to cash flow (P/CF) ratio stood at 8.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	42.7	59.9
TTM Earnings per share	Rs	2.9	6.1
Diluted earnings per share	Rs	2.9	6.1
Price to Cash Flow	x	10.0	8.6
TTM P/E ratio	x	13.0	12.2
Price / Book Value ratio	x	1.1	1.7
Market Cap	Rs m	1,242	2,138
Dividends per share (Unadj.)	Rs	2.2	4.0

Ratio Analysis for ADOR FONTECH

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.6x during FY22, from 3.3x during FY21. 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 96.7x during FY22, from 46.7x during FY21. 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 17.4% during FY22, from 9.2% during FY22. 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 24.4% during FY22, from 15.4% during FY21. 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 14.3% during FY22, from 7.5% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	3.3	3.6
Debtors’ Days	Days	672	491
Interest coverage	x	46.7	96.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.5	14.3
Return on equity	%	9.2	17.4
Return on capital employed	%	15.4	24.4

To see how ADOR FONTECH has performed over the last 5 years, please visit here.

ADOR FONTECH Share Price Performance

Over the last one year, ADOR FONTECH share price has moved up from Rs 63.6 to Rs 74.7, registering a gain of Rs 11.2 or around 17.5%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 26,447.5 (up 0.8%). Over the last one year it has moved up from 22,918.7 to 26,447.5, a gain of 3,529 points (up 15.4%).

Overall, the S&P BSE SENSEX is up 1.6% over the year.

(To know more, check out historical annual results for ADOR FONTECH and quarterly results for ADOR FONTECH)

Read: Latest Annual Report Analysis of ADOR FONTECH