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BENGAL TEA 2022-23 Annual Report Analysis

Mon, 17 Jul

BENGAL TEA 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.

BENGAL TEA Income Statement Analysis

• Operating income during the year fell 10.2% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 99.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 0.1% in FY23 as against 72.5% in FY22.
• Depreciation charges decreased by 1.2% and finance costs decreased by 0.7% YoY, respectively.
• Other income grew by 101.6% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year declined from 72.5% in FY22 to 2.4% in FY23.

BENGAL TEA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	551	495	-10.2%
Other income	Rs m	14	28	101.6%
Total Revenues	Rs m	565	523	-7.5%
Gross profit	Rs m	400	0	-99.9%
Depreciation	Rs m	18	18	-1.2%
Interest	Rs m	4	4	-0.7%
Profit before tax	Rs m	391	6	-98.5%
Tax	Rs m	-9	18	NA
Profit after tax	Rs m	400	-12	NA
Gross profit margin	%	72.5	0.1
Effective tax rate	%	-2.2	308.4
Net profit margin	%	72.5	-2.4

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BENGAL TEA Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 131 million as compared to Rs 90 million in FY22, thereby witnessing an increase of 45.3%.
• Current assets rose 4% and stood at Rs 546 million, while fixed assets rose 31% and stood at Rs 648 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 1 billion as against Rs 1 billion during FY22, thereby witnessing a growth of 3%.

BENGAL TEA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	1,150	1,133	-1.5
Current Liabilities	Rs m	90	131	45.3
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	1,169	1,202	2.8
Current assets	Rs m	526	546	3.7
Fixed Assets	Rs m	493	648	31.3
Total Assets	Rs m	1,169	1,202	2.8

BENGAL TEA Cash Flow Statement Analysis

• BENGAL TEA's cash flow from operating activities (CFO) during FY23 stood at Rs 61 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -235 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 46 million, an improvement of 122% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -128 million from the Rs 138 million net cash flows seen during FY22.

BENGAL TEA 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	66	61	-7.0%
Cash Flow from Investing Activities	Rs m	282	-235	-
Cash Flow from Financing Activities	Rs m	-210	46	-
Net Cash Flow	Rs m	138	-128	-

Current Valuations for BENGAL TEA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -1.3, an decline from the EPS of Rs 44.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 80.0, stands at 2.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.6 times, while the price to sales ratio stands at 1.5 times.
• The company's price to cash flow (P/CF) ratio stood at 123.7 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	61.2	55.0
TTM Earnings per share	Rs	44.4	-1.3
Diluted earnings per share	Rs	44.4	-1.3
Price to Cash Flow	x	1.5	123.7
TTM P/E ratio	x	1.6	2.2
Price / Book Value ratio	x	0.5	0.6
Market Cap	Rs m	538	705
Dividends per share (Unadj.)	Rs	1.0	1.0

Ratio Analysis for BENGAL TEA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 4.2x during FY23, from 5.8x 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 deteriorated and stood at 2.4x during FY23, from 91.5x 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 declined and down at -1.1% during FY23, from 34.8% 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 declined and down at 0.9% during FY23, from 34.4% 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 declined and down at -0.6% during FY23, from 34.6% 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	5.8	4.2
Debtors’ Days	Days	4	27
Interest coverage	x	91.5	2.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	34.6	-0.6
Return on equity	%	34.8	-1.1
Return on capital employed	%	34.4	0.9

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

BENGAL TEA Share Price Performance

Over the last one year, BENGAL TEA share price has moved up from Rs 76.0 to Rs 80.0, registering a gain of Rs 4.1 or around 5.3%.

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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