INDUS TOWERS 2018-19 Annual Report Analysis

Sun, 31 Mar

INDUS TOWERS 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.

INDUS TOWERS Income Statement Analysis

• Operating income during the year rose 3.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 1.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 44.2% in FY19 as against 44.9% in FY18.
• Depreciation charges decreased by 9.7% and finance costs increased by 13.8% YoY, respectively.
• Other income grew by 32.2% YoY.
• Net profit for the year grew by 24.0% YoY.
• Net profit margins during the year grew from 18.0% in FY18 to 21.6% in FY19.

INDUS TOWERS Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	66,212	68,262	3.1%
Other income	Rs m	4,806	6,355	32.2%
Total Revenues	Rs m	71,018	74,617	5.1%
Gross profit	Rs m	29,727	30,187	1.5%
Depreciation	Rs m	11,801	10,658	-9.7%
Interest	Rs m	465	529	13.8%
Profit before tax	Rs m	22,267	25,355	13.9%
Tax	Rs m	10,355	10,589	2.3%
Profit after tax	Rs m	11,912	14,766	24.0%
Gross profit margin	%	44.9	44.2
Effective tax rate	%	46.5	41.8
Net profit margin	%	18.0	21.6

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INDUS TOWERS Balance Sheet Analysis

• The company's current liabilities during FY19 down at Rs 18 billion as compared to Rs 18 billion in FY18, thereby witnessing an decrease of -2.2%.
• Current assets fell 44% and stood at Rs 43 billion, while fixed assets rose 7% and stood at Rs 128 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 171 billion as against Rs 196 billion during FY18, thereby witnessing a fall of 13%.

INDUS TOWERS Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	169,644	145,248	-14.4
Current Liabilities	Rs m	18,159	17,752	-2.2
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	196,254	171,146	-12.8
Current assets	Rs m	76,120	42,800	-43.8
Fixed Assets	Rs m	120,134	128,346	6.8
Total Assets	Rs m	196,254	171,146	-12.8

INDUS TOWERS Cash Flow Statement Analysis

• INDUS TOWERS's cash flow from operating activities (CFO) during FY19 stood at Rs 32 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs 16 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -48 billion on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -362 million from the Rs -19 billion net cash flows seen during FY18.

INDUS TOWERS 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	34,694	31,586	-9.0%
Cash Flow from Investing Activities	Rs m	-18,551	15,999	-
Cash Flow from Financing Activities	Rs m	-35,548	-47,947	-
Net Cash Flow	Rs m	-19,405	-362	-

Current Valuations for INDUS TOWERS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.0, an improvement from the EPS of Rs 6.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 313.5, stands at 47.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.8 times, while the price to sales ratio stands at 8.5 times.
• The company's price to cash flow (P/CF) ratio stood at 21.5 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	35.8	36.9
TTM Earnings per share	Rs	6.4	8.0
Diluted earnings per share	Rs	4.4	5.5
Price to Cash Flow	x	38.2	21.5
TTM P/E ratio	x	76.1	47.6
Price / Book Value ratio	x	4.4	3.8
Market Cap	Rs m	740,352	546,004
Dividends per share (Unadj.)	Rs	14.0	15.0

Ratio Analysis for INDUS TOWERS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.4x during FY19, from 4.2x 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 improved and stood at 48.9x during FY19, from 48.9x 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 10.2% during FY19, from 7.0% 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 17.8% during FY19, from 13.4% 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 8.9% during FY19, from 6.3% 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	4.2	2.4
Debtors’ Days	Days	15	29
Interest coverage	x	48.9	48.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.3	8.9
Return on equity	%	7.0	10.2
Return on capital employed	%	13.4	17.8

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

INDUS TOWERS Share Price Performance

Over the last one year, INDUS TOWERS share price has moved down from Rs 336.3 to Rs 313.5, registering a loss of Rs 22.8 or around 6.8%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 7,621.8 (up 0.4%). Over the last one year it has moved up from 6,513.3 to 7,621.8, a gain of 1,109 points (up 17.0%).

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

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

Read: Latest Annual Report Analysis of INDUS TOWERS