BAJAJ STEEL 2022-23 Annual Report Analysis

Wed, 4 Oct

BAJAJ STEEL 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.

BAJAJ STEEL Income Statement Analysis

• Operating income during the year rose 22.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 84.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.0% in FY23 as against 11.9% in FY22.
• Depreciation charges increased by 10.0% and finance costs decreased by 4.8% YoY, respectively.
• Other income grew by 14.6% YoY.
• Net profit for the year grew by 85.0% YoY.
• Net profit margins during the year grew from 8.4% in FY22 to 12.7% in FY23.

BAJAJ STEEL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	4,369	5,333	22.1%
Other income	Rs m	133	152	14.6%
Total Revenues	Rs m	4,502	5,485	21.8%
Gross profit	Rs m	520	958	84.4%
Depreciation	Rs m	90	98	10.0%
Interest	Rs m	76	72	-4.8%
Profit before tax	Rs m	487	940	93.0%
Tax	Rs m	122	265	116.8%
Profit after tax	Rs m	365	675	85.0%
Gross profit margin	%	11.9	18.0
Effective tax rate	%	25.1	28.2
Net profit margin	%	8.4	12.7

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BAJAJ STEEL Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 1 billion in FY22, thereby witnessing an increase of 6.6%.
• Long-term debt down at Rs 90 million as compared to Rs 267 million during FY22, a fall of 66.4%.
• Current assets rose 8% and stood at Rs 3 billion, while fixed assets rose 32% and stood at Rs 1 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 4 billion as against Rs 4 billion during FY22, thereby witnessing a growth of 14%.

BAJAJ STEEL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	2,068	2,736	32.3
Current Liabilities	Rs m	1,473	1,569	6.6
Long-term Debt	Rs m	267	90	-66.4
Total Liabilities	Rs m	3,913	4,480	14.5
Current assets	Rs m	2,874	3,103	8.0
Fixed Assets	Rs m	1,039	1,377	32.5
Total Assets	Rs m	3,913	4,480	14.5

BAJAJ STEEL Cash Flow Statement Analysis

• BAJAJ STEEL's cash flow from operating activities (CFO) during FY23 stood at Rs 265 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -521 million, an improvement of 157.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -219 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -475 million from the Rs 390 million net cash flows seen during FY22.

BAJAJ STEEL 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	551	265	-51.9%
Cash Flow from Investing Activities	Rs m	-202	-521	-
Cash Flow from Financing Activities	Rs m	41	-219	-
Net Cash Flow	Rs m	390	-475	-

Current Valuations for BAJAJ STEEL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 129.8, an improvement from the EPS of Rs 70.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,084.0, stands at 8.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.1 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 5.6 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	840.2	1,025.6
TTM Earnings per share	Rs	70.2	129.8
Diluted earnings per share	Rs	70.2	129.8
Price to Cash Flow	x	7.2	5.6
TTM P/E ratio	x	9.0	8.1
Price / Book Value ratio	x	2.4	1.6
Market Cap	Rs m	5,019	4,318
Dividends per share (Unadj.)	Rs	2.0	3.0

Ratio Analysis for BAJAJ STEEL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.0x during FY23, from 2.0x 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 improved and stood at 14.0x during FY23, from 7.4x 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 improved and stood at 24.7% during FY23, from 17.6% 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 improved and stood at 35.8% during FY23, from 24.1% 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 improved and stood at 16.7% during FY23, from 11.3% 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	2.0	2.0
Debtors’ Days	Days	196	290
Interest coverage	x	7.4	14.0
Debt to equity ratio	x	0.1	0.0
Return on assets	%	11.3	16.7
Return on equity	%	17.6	24.7
Return on capital employed	%	24.1	35.8

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

BAJAJ STEEL Share Price Performance

Over the last one year, BAJAJ STEEL share price has moved up from Rs 570.7 to Rs 1,084.0, registering a gain of Rs 513.3 or around 89.9%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 47,575.1 (down 1.3%). Over the last one year it has moved up from 31,494.4 to 47,575.1, a gain of 16,081 points (up 51.1%).

Overall, the S&P BSE SENSEX is up 15.7% over the year.

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