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ASIAN PAINTS 2017-18 Annual Report Analysis

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ASIAN PAINTS 2017-18 Annual Report Analysis
Wed, 8 Aug

ASIAN PAINTS 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.

ASIAN PAINTS Income Statement Analysis

  • Operating income during the year rose 11.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 7.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 19.0% in FY18 as against 19.8% in FY17.
  • Depreciation charges and finance costs increased by 7.7% YoY and 16.9% YoY, respectively.
  • Other income declined by 15.9% YoY.
  • Net profit for the year grew by 1.9% YoY.
  • Net profit margins during the year declined from 13.0% in FY17 to 11.9% in FY18.

ASIAN PAINTS Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 150,620 168,246 11.7%
Other income Rs m 2,624 2,206 -15.9%
Total Revenues Rs m 153,244 170,452 11.2%
Gross profit Rs m 29,864 31,976 7.1%
Depreciation Rs m 3,348 3,605 7.7%
Interest Rs m 300 351 16.9%
Profit before tax Rs m 28,841 30,227 4.8%
Tax Rs m 9,433 10,410 10.4%
Profit after tax Rs m 19,904 20,275 1.9%
Gross profit margin % 19.8 19.0
Effective tax rate % 32.7 34.4
Net profit margin % 13.0 11.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



ASIAN PAINTS Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 45 billion as compared to Rs 39 billion in FY17, thereby witnessing an increase of 14.6%.
  • Long-term debt down at Rs 283 million as compared to Rs 411 million during FY17, a fall of 31.0%.
  • Current assets fell 1% and stood at Rs 69 billion, while fixed assets rose 44% and stood at Rs 51 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 138 billion as against Rs 124 billion during FY17, thereby witnessing a growth of 11%.

ASIAN PAINTS Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 76,039 84,102 10.6
 
Current Liabilities Rs m 38,849 44,511 14.6
Long-term Debt Rs m 411 283 -31.0
Total Liabilities Rs m 124,214 137,833 11.0
 
Current assets Rs m 69,657 69,141 -0.7
Fixed Assets Rs m 35,597 51,374 44.3
Total Assets Rs m 124,214 137,833 11.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



ASIAN PAINTS Cash Flow Statement Analysis

  • ASIAN PAINTS's cash flow from operating activities (CFO) during FY18 stood at Rs 21 billion, an improvement of 38.4% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -16 billion, an improvement of 143.8% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -14 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs -8 billion from the Rs 1 billion net cash flows seen during FY17.

ASIAN PAINTS 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 15,273 21,134 38.4%
Cash Flow from Investing Activities Rs m -6,561 -15,993 -
Cash Flow from Financing Activities Rs m -7,564 -13,791 -
Net Cash Flow Rs m 1,148 -8,218 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for ASIAN PAINTS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 21.1, an improvement from the EPS of Rs 20.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,424.9, stands at 64.7 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 13.1 times, while the price to sales ratio stands at 6.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 58.4 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 157.0 175.4
TTM Earnings per share Rs 20.8 21.1
Diluted earnings per share Rs 20.8 21.1
Price to Cash Flow x 60.1 58.4
TTM P/E ratio x 64.7 64.7
Price / Book Value ratio x 13.1 13.1
Market Cap Rs m 1,366,716 1,366,716
Dividends per share (Unadj.) Rs 10.3 8.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for ASIAN PAINTS

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.6x during FY18, from 1.8x 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 deteriorated and stood at 87.2x during FY18, from 97.2x 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 24.1% during FY18, from 26.2% 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 36.8% during FY18, from 38.8% 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 15.0% during FY18, from 16.3% 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 1.8 1.6
Debtors’ Days Days 35 38
Interest coverage x 97.2 87.2
Debt to equity ratio x 0.0 0.0
Return on assets % 16.3 15.0
Return on equity % 26.2 24.1
Return on capital employed % 38.8 36.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

ASIAN PAINTS Share Price Performance

Over the last one year, ASIAN PAINTS share price has moved up from Rs 1,145.7 to Rs 1,424.9, registering a gain of Rs 279.2 or around 24.4%.

Overall, the S&P BSE SENSEX is up 17.4% over the year.

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

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Jan 24, 2019 | Updated on Jan 24, 2019

For the quarter ended December 2018, ASIAN PAINTS has posted a net profit of Rs 6 bn (up 14.7% YoY). Sales on the other hand came in at Rs 53 bn (up 24.1% YoY). Read on for a complete analysis of ASIAN PAINTS's quarterly results.

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