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MPHASIS 2018-19 Annual Report Analysis
Sun, 31 Mar

MPHASIS has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

MPHASIS Income Statement Analysis

  • Operating income during the year rose 19.5% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 26.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.9% in FY19 as against 16.0% in FY18.
  • Depreciation charges increased by 7.1% and finance costs increased by 33.6% YoY, respectively.
  • Other income grew by 6.8% YoY.
  • Net profit for the year grew by 28.2% YoY.
  • Net profit margins during the year grew from 12.8% in FY18 to 13.7% in FY19.

MPHASIS Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 65,458 78,194 19.5%
Other income Rs m 1,654 1,767 6.8%
Total Revenues Rs m 67,112 79,961 19.1%
Gross profit Rs m 10,460 13,238 26.6%
Depreciation Rs m 708 758 7.1%
Interest Rs m 130 174 33.6%
Profit before tax Rs m 11,276 14,073 24.8%
Tax Rs m 2,901 3,340 15.1%
Profit after tax Rs m 8,375 10,734 28.2%
Gross profit margin % 16.0 16.9
Effective tax rate % 25.7 23.7
Net profit margin % 12.8 13.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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MPHASIS Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 20 billion as compared to Rs 14 billion in FY18, thereby witnessing an increase of 42.2%.
  • Current assets rose 4% and stood at Rs 41 billion, while fixed assets rose 9% and stood at Rs 32 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 73 billion as against Rs 69 billion during FY18, thereby witnessing a growth of 6%.

MPHASIS Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 54,500 52,005 -4.6
 
Current Liabilities Rs m 14,020 19,937 42.2
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 68,797 72,897 6.0
 
Current assets Rs m 39,460 41,031 4.0
Fixed Assets Rs m 29,336 31,866 8.6
Total Assets Rs m 68,797 72,897 6.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



MPHASIS Cash Flow Statement Analysis

  • MPHASIS's cash flow from operating activities (CFO) during FY19 stood at Rs 9 billion, an improvement of 31.3% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs 3 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -13 billion, an improvement of 3% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -1 billion from the Rs -1 billion net cash flows seen during FY18.

MPHASIS Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 7,233 9,497 31.3%
Cash Flow from Investing Activities Rs m 4,925 2,893 -41.3%
Cash Flow from Financing Activities Rs m -13,797 -13,418 -
Net Cash Flow Rs m -1,491 -1,122 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for MPHASIS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 57.6, an improvement from the EPS of Rs 43.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 988.9, stands at 17.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.6 times, while the price to sales ratio stands at 2.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 338.7 419.9
TTM Earnings per share Rs 43.3 57.6
Diluted earnings per share Rs 44.6 57.1
Price to Cash Flow x 17.5 17.1
TTM P/E ratio x 18.9 17.3
Price / Book Value ratio x 2.6 3.8
Market Cap Rs m 140,587 196,927
Dividends per share (Unadj.) Rs 20.0 27.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for MPHASIS

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 2.1x during FY19, from 2.8x during FY18. 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 82.0x during FY19, from 87.8x during FY18. 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 20.6% during FY19, from 15.4% during FY19. 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 27.4% during FY19, from 20.9% during FY18. 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 15.0% during FY19, from 12.4% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 2.8 2.1
Debtors’ Days Days 45 45
Interest coverage x 87.8 82.0
Debt to equity ratio x 0.0 0.0
Return on assets % 12.4 15.0
Return on equity % 15.4 20.6
Return on capital employed % 20.9 27.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

MPHASIS Share Price Performance

Over the last one year, MPHASIS share price has moved up from Rs 843.7 to Rs 988.9, registering a gain of Rs 145.2 or around 17.2%.

Meanwhile, the S&P BSE IT Index is trading at Rs 15,280.3 (up 0.4%). Over the last one year it has moved up from 12,100.6 to 15,280.3, a gain of 3,180 points (up 26.3%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Annual Report FAQs

What is the current share price of MPHASIS?

MPHASIS currently trades at Rs 2,459.3 per share. You can check out the latest share price performance of MPHASIS here...

What was the revenue of MPHASIS in FY19? How does it compare to earlier years?

The revenues of MPHASIS stood at Rs 79,961 m in FY19, which was up 19.1% compared to Rs 67,112 m reported in FY18.

MPHASIS' revenue has grown from Rs 59,918 m in FY15 to Rs 79,961 m in FY19.

Over the past 5 years, the revenue of MPHASIS has grown at a CAGR of 7.5%.

What was the net profit of MPHASIS in FY19? How does it compare to earlier years?

The net profit of MPHASIS stood at Rs 10,734 m in FY19, which was up 28.2% compared to Rs 8,375 m reported in FY18.

This compares to a net profit of Rs 7,916 m in FY17 and a net profit of Rs 6,315 m in FY16.

Over the past 5 years, MPHASIS net profit has grown at a CAGR of 12.3%.

What does the cash flow statement of MPHASIS 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 MPHASIS reveals:

  • Cash flow from operations increased in FY19 and stood at Rs 9,497 m as compared to Rs 7,233 m in FY18.
  • Cash flow from investments decreased in FY19 and stood at Rs 2,893 m as compared to Rs 4,925 m in FY18.
  • Cash flow from financial activity increased in FY19 and stood at Rs -13,418 m as compared to Rs -13,797 m in FY18.

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

(Rs m)FY15FY16FY17FY18FY19
From Operations6,1657,3086,6417,2339,497
From Investments-3,664-1,5842,6794,9252,893
From Financial Activity-1,863-5,678-7,100-13,797-13,418
Net Cashflow503-1172,207-1,491-1,122

What does the Key Ratio analysis of MPHASIS 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 MPHASIS reveals:

  • Operating profit margins witnessed a fall and down at 16.9% in FY19 as against 16.0% in FY18.
  • Net profit margins grew from 12.8% in FY18 to 13.7% in FY19.
  • Debt to Equity ratio for FY19 stood at 0.0 as compared to 0.0 in FY18.

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

 FY15FY16FY17FY18FY19
Operating Profit Margin (%)15.013.715.716.016.9
Net Profit Margin (%)11.610.413.012.813.7
Debt to Equity Ratio (x)0.10.00.00.00.0

Read: Latest Annual Report Analysis of MPHASIS

 

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