AVONMORE CAPITAL 2021-22 Annual Report Analysis

Thu, 31 Mar

AVONMORE CAPITAL 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.

AVONMORE CAPITAL Income Statement Analysis

• Operating income during the year rose 23.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 49.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 59.5% in FY22 as against 49.4% in FY21.
• Depreciation charges decreased by 10.4% and finance costs increased by 97.3% YoY, respectively.
• Other income declined by 21.7% YoY.
• Net profit for the year grew by 35.8% YoY.
• Net profit margins during the year grew from 44.1% in FY21 to 48.3% in FY22.

AVONMORE CAPITAL Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	675	837	23.9%
Other income	Rs m	45	35	-21.7%
Total Revenues	Rs m	720	872	21.1%
Gross profit	Rs m	334	498	49.1%
Depreciation	Rs m	28	25	-10.4%
Interest	Rs m	27	53	97.3%
Profit before tax	Rs m	324	455	40.4%
Tax	Rs m	26	50	92.0%
Profit after tax	Rs m	298	405	35.8%
Gross profit margin	%	49.4	59.5
Effective tax rate	%	8.1	11.0
Net profit margin	%	44.1	48.3

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AVONMORE CAPITAL Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 814 million as compared to Rs 567 million in FY21, thereby witnessing an increase of 43.6%.
• Long-term debt down at Rs 84 million as compared to Rs 93 million during FY21, a fall of 9.6%.
• Current assets rose 23% and stood at Rs 2 billion, while fixed assets rose 19% and stood at Rs 2 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 4 billion as against Rs 3 billion during FY21, thereby witnessing a growth of 21%.

AVONMORE CAPITAL Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	1,726	2,046	18.5
Current Liabilities	Rs m	567	814	43.6
Long-term Debt	Rs m	93	84	-9.6
Total Liabilities	Rs m	3,036	3,683	21.3
Current assets	Rs m	1,689	2,077	23.0
Fixed Assets	Rs m	1,347	1,606	19.2
Total Assets	Rs m	3,036	3,683	21.3

AVONMORE CAPITAL Cash Flow Statement Analysis

• AVONMORE CAPITAL's cash flow from operating activities (CFO) during FY22 stood at Rs -6 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs 123 million, an improvement of 411.6% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -78 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 39 million from the Rs -73 million net cash flows seen during FY21.

AVONMORE CAPITAL 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	-36	-6	-
Cash Flow from Investing Activities	Rs m	24	123	411.6%
Cash Flow from Financing Activities	Rs m	-62	-78	-
Net Cash Flow	Rs m	-73	39	-

Current Valuations for AVONMORE CAPITAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 16.7, an improvement from the EPS of Rs 12.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 84.7, stands at 16.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.0 times, while the price to sales ratio stands at 2.5 times.
• The company's price to cash flow (P/CF) ratio stood at 3.2 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	27.8	34.5
TTM Earnings per share	Rs	12.3	16.7
Diluted earnings per share	Rs	12.8	17.3
Price to Cash Flow	x	1.3	3.2
TTM P/E ratio	x	5.6	16.3
Price / Book Value ratio	x	0.2	0.7
Market Cap	Rs m	360	1,363
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for AVONMORE CAPITAL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.6x during FY22, from 3.0x 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 deteriorated and stood at 9.5x during FY22, from 13.0x 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 19.8% during FY22, from 17.2% 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 23.9% during FY22, from 19.3% 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 12.4% during FY22, from 10.7% 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	3.0	2.6
Debtors’ Days	Days	1,543	1,636
Interest coverage	x	13.0	9.5
Debt to equity ratio	x	0.1	0.0
Return on assets	%	10.7	12.4
Return on equity	%	17.2	19.8
Return on capital employed	%	19.3	23.9

To see how AVONMORE CAPITAL has performed over the last 5 years, please visit here.

AVONMORE CAPITAL Share Price Performance

Over the last one year, AVONMORE CAPITAL share price has moved up from Rs 18.2 to Rs 84.7, registering a gain of Rs 66.5 or around 365.1%.

Overall, the S&P BSE SENSEX is up 16.8% over the year.

(To know more, check out historical annual results for AVONMORE CAPITAL and quarterly results for AVONMORE CAPITAL)