BHARAT ELECTRONICS 2020-21 Annual Report Analysis

Wed, 31 Mar

BHARAT ELECTRONICS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

BHARAT ELECTRONICS Income Statement Analysis

• Operating income during the year rose 8.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 26.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 22.6% in FY21 as against 19.5% in FY20.
• Depreciation charges increased by 4.2% and finance costs increased by 25.5% YoY, respectively.
• Other income declined by 53.5% YoY.
• Net profit for the year grew by 15.4% YoY.
• Net profit margins during the year grew from 13.8% in FY20 to 14.7% in FY21.

BHARAT ELECTRONICS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	129,677	141,087	8.8%
Other income	Rs m	3,307	1,536	-53.5%
Total Revenues	Rs m	132,984	142,623	7.2%
Gross profit	Rs m	25,272	31,851	26.0%
Depreciation	Rs m	3,719	3,873	4.2%
Interest	Rs m	77	96	25.5%
Profit before tax	Rs m	24,784	29,418	18.7%
Tax	Rs m	6,858	8,724	27.2%
Profit after tax	Rs m	17,926	20,693	15.4%
Gross profit margin	%	19.5	22.6
Effective tax rate	%	27.7	29.7
Net profit margin	%	13.8	14.7

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BHARAT ELECTRONICS Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 168 billion as compared to Rs 129 billion in FY20, thereby witnessing an increase of 30.8%.
• Current assets rose 27% and stood at Rs 237 billion, while fixed assets rose 4% and stood at Rs 53 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 290 billion as against Rs 238 billion during FY20, thereby witnessing a growth of 22%.

BHARAT ELECTRONICS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	100,715	110,596	9.8
Current Liabilities	Rs m	128,657	168,318	30.8
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	238,496	290,285	21.7
Current assets	Rs m	187,381	237,156	26.6
Fixed Assets	Rs m	51,115	53,129	3.9
Total Assets	Rs m	238,496	290,285	21.7

BHARAT ELECTRONICS Cash Flow Statement Analysis

• BHARAT ELECTRONICS's cash flow from operating activities (CFO) during FY21 stood at Rs 51 billion, an improvement of 98.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -26 billion, an improvement of 299.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -11 billion on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 14 billion from the Rs 9 billion net cash flows seen during FY20.

BHARAT ELECTRONICS Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	25,704	50,932	98.1%
Cash Flow from Investing Activities	Rs m	-6,490	-25,952	-
Cash Flow from Financing Activities	Rs m	-10,605	-10,757	-
Net Cash Flow	Rs m	8,609	14,223	65.2%

Current Valuations for BHARAT ELECTRONICS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.5, an improvement from the EPS of Rs 7.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 125.1, stands at 14.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.8 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 10.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	53.2	57.9
TTM Earnings per share	Rs	7.4	8.5
Diluted earnings per share	Rs	7.4	8.5
Price to Cash Flow	x	8.4	10.5
TTM P/E ratio	x	10.1	14.7
Price / Book Value ratio	x	2.2	2.3
Market Cap	Rs m	217,222	259,132
Dividends per share (Unadj.)	Rs	2.8	4.0

Ratio Analysis for BHARAT ELECTRONICS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.4x during FY21, from 1.5x during FY20. 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 307.1x during FY21, from 324.6x during FY20. 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 18.7% during FY21, from 17.8% during FY21. 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 26.7% during FY21, from 24.7% during FY20. 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 7.2% during FY21, from 7.5% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.5	1.4
Debtors’ Days	Days	1,893	1,698
Interest coverage	x	324.6	307.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.5	7.2
Return on equity	%	17.8	18.7
Return on capital employed	%	24.7	26.7

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

BHARAT ELECTRONICS Share Price Performance

Over the last one year, BHARAT ELECTRONICS share price has moved up from Rs 74.4 to Rs 125.1, registering a gain of Rs 50.8 or around 68.3%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of BHARAT ELECTRONICS