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ARVIND 2017-18 Annual Report Analysis
Sat, 31 Mar

ARVIND has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

ARVIND Income Statement Analysis

  • Operating income during the year fell 26.0% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 29.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 9.8% in FY18 as against 10.3% in FY17.
  • Depreciation charges decreased by 25.2% and finance costs decreased by 38.4% YoY, respectively.
  • Other income grew by 64.5% YoY.
  • Net profit for the year declined by 1.8% YoY.
  • Net profit margins during the year grew from 3.5% in FY17 to 4.6% in FY18.

ARVIND Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 91,851 67,937 -26.0%
Other income Rs m 817 1,343 64.5%
Total Revenues Rs m 92,667 69,280 -25.2%
Gross profit Rs m 9,452 6,678 -29.3%
Depreciation Rs m 2,971 2,224 -25.2%
Interest Rs m 3,120 1,922 -38.4%
Profit before tax Rs m 4,178 3,877 -7.2%
Tax Rs m 989 746 -24.6%
Profit after tax Rs m 3,189 3,131 -1.8%
Gross profit margin % 10.3 9.8
Effective tax rate % 23.7 19.2
Net profit margin % 3.5 4.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

ARVIND Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 51 billion as compared to Rs 39 billion in FY17, thereby witnessing an increase of 29.9%.
  • Long-term debt stood at Rs 8 billion as compared to Rs 8 billion during FY17, a growth of 12.2%.
  • Current assets rose 36% and stood at Rs 55 billion, while fixed assets rose 3% and stood at Rs 45 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 100 billion as against Rs 84 billion during FY17, thereby witnessing a growth of 19%.

ARVIND Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 35,542 37,697 6.1
 
Current Liabilities Rs m 39,289 51,048 29.9
Long-term Debt Rs m 7,566 8,487 12.2
Total Liabilities Rs m 84,438 100,379 18.9
 
Current assets Rs m 40,834 55,394 35.7
Fixed Assets Rs m 43,604 44,985 3.2
Total Assets Rs m 84,438 100,379 18.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



ARVIND Cash Flow Statement Analysis

  • ARVIND's cash flow from operating activities (CFO) during FY18 stood at Rs 4 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -4 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -554 million, an improvement of 91% on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 197 million from the Rs -35 million net cash flows seen during FY17.

ARVIND Cash Flow Statement 2017-18

Particulars No. of months 12 12 % Change
Year Ending Mar-17 Mar-18
Cash Flow from Operating Activities Rs m 5,511 4,285 -22.2%
Cash Flow from Investing Activities Rs m 665 -3,560 -
Cash Flow from Financing Activities Rs m -6,211 -554 -
Net Cash Flow Rs m -35 197 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for ARVIND

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 12.1, an decline from the EPS of Rs 12.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 384.7, stands at 32.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.7 times, while the price to sales ratio stands at 1.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 20.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Sales per share (Unadj.) Rs 355.5 262.7
TTM Earnings per share Rs 12.3 12.1
Diluted earnings per share Rs 12.2 12.0
Price to Cash Flow x 16.7 20.1
TTM P/E ratio x 32.4 32.0
Price / Book Value ratio x 2.5 2.9
Market Cap Rs m 87,958 107,539
Dividends per share (Unadj.) Rs 2.4 2.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for ARVIND

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.1x during FY18, from 1.0x during FY17. 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 3.0x during FY18, from 2.3x during FY17. 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 8.3% during FY18, from 9.0% during FY18. 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 12.6% during FY18, from 16.9% during FY17. 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 5.0% during FY18, from 7.5% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Current ratio x 1.0 1.1
Debtors’ Days Days 3 9
Interest coverage x 2.3 3.0
Debt to equity ratio x 0.2 0.2
Return on assets % 7.5 5.0
Return on equity % 9.0 8.3
Return on capital employed % 16.9 12.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

ARVIND Share Price Performance

Over the last one year, ARVIND share price has moved down from Rs 393.8 to Rs 384.7, registering a loss of Rs 9.1 or around 2.3%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Annual Report FAQs

What is the current share price of ARVIND?

ARVIND currently trades at Rs 270.2 per share. You can check out the latest share price performance of ARVIND here...

What was the revenue of ARVIND in FY18? How does it compare to earlier years?

The revenues of ARVIND stood at Rs 69,280 m in FY18, which was down -25.2% compared to Rs 92,667 m reported in FY17.

ARVIND's revenue has fallen from Rs 69,352 m in FY14 to Rs 69,280 m in FY18.

Over the past 5 years, the revenue of ARVIND has grown at a CAGR of 0.0%.

What was the net profit of ARVIND in FY18? How does it compare to earlier years?

The net profit of ARVIND stood at Rs 3,131 m in FY18, which was down -1.8% compared to Rs 3,189 m reported in FY17.

This compares to a net profit of Rs 3,108 m in FY16 and a net profit of Rs 3,376 m in FY15.

Over the past 5 years, ARVIND net profit has grown at a CAGR of -2.9%.

What does the cash flow statement of ARVIND reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of ARVIND reveals:

  • Cash flow from operations decreased in FY18 and stood at Rs 4,285 m as compared to Rs 5,511 m in FY17.
  • Cash flow from investments decreased in FY18 and stood at Rs -3,560 m as compared to Rs 665 m in FY17.
  • Cash flow from financial activity increased in FY18 and stood at Rs -554 m as compared to Rs -6,211 m in FY17.

Here's the cash flow statement of ARVIND for the past 5 years.

(Rs m)FY14FY15FY16FY17FY18
From Operations3,8835,5846,5035,5114,285
From Investments-5,734-5,874-5,025665-3,560
From Financial Activity1,472-485-1,509-6,211-554
Net Cashflow-380-775-32-35197

What does the Key Ratio analysis of ARVIND reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of ARVIND reveals:

  • Operating profit margins witnessed a fall and stood at 9.8% in FY18 as against 10.3% in FY17.
  • Net profit margins grew from 3.5% in FY17 to 4.6% in FY18.
  • Debt to Equity ratio for FY18 stood at 0.2 as compared to 0.2 in FY17.

Here's the ratio/financial analysis of ARVIND for the past 5 years.

 FY14FY15FY16FY17FY18
Operating Profit Margin (%)13.412.612.310.39.8
Net Profit Margin (%)5.14.43.93.54.6
Debt to Equity Ratio (x)0.50.50.60.20.2

Read: Latest Annual Report Analysis of ARVIND

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