BERGER PAINTS 2019-20 Annual Report Analysis

Tue, 20 Oct

BERGER PAINTS has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

BERGER PAINTS Income Statement Analysis

• Operating income during the year rose 5.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 13.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.7% in FY20 as against 15.5% in FY19.
• Depreciation charges increased by 4.8% and finance costs decreased by 0.4% YoY, respectively.
• Other income grew by 14.1% YoY.
• Net profit for the year grew by 32.8% YoY.
• Net profit margins during the year grew from 8.1% in FY19 to 10.2% in FY20.

BERGER PAINTS Income Statement 2019-20

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Net Sales	Rs m	60,619	63,658	5.0%
Other income	Rs m	600	685	14.1%
Total Revenues	Rs m	61,219	64,343	5.1%
Gross profit	Rs m	9,374	10,610	13.2%
Depreciation	Rs m	1,823	1,910	4.8%
Interest	Rs m	472	470	-0.4%
Profit before tax	Rs m	7,679	8,915	16.1%
Tax	Rs m	2,732	2,271	-16.9%
Profit after tax	Rs m	4,939	6,561	32.8%
Gross profit margin	%	15.5	16.7
Effective tax rate	%	35.6	25.5
Net profit margin	%	8.1	10.2

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BERGER PAINTS Balance Sheet Analysis

• The company's current liabilities during FY20 stood at Rs 17 billion as compared to Rs 15 billion in FY19, thereby witnessing an increase of 11.3%.
• Long-term debt stood at Rs 2 billion as compared to Rs 2 billion during FY19, a growth of 1.9%.
• Current assets rose 0% and stood at Rs 26 billion, while fixed assets rose 32% and stood at Rs 22 billion in FY20.
• Overall, the total assets and liabilities for FY20 stood at Rs 49 billion as against Rs 46 billion during FY19, thereby witnessing a growth of 7%.

BERGER PAINTS Balance Sheet as on March 2020

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Networth	Rs m	24,727	26,601	7.6
Current Liabilities	Rs m	15,330	17,066	11.3
Long-term Debt	Rs m	2,389	2,434	1.9
Total Liabilities	Rs m	45,670	49,050	7.4
Current assets	Rs m	25,836	25,865	0.1
Fixed Assets	Rs m	16,861	22,299	32.2
Total Assets	Rs m	45,670	49,050	7.4

BERGER PAINTS Cash Flow Statement Analysis

• BERGER PAINTS's cash flow from operating activities (CFO) during FY20 stood at Rs 7 billion, an improvement of 18.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY20 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY20 stood at Rs -5 billion on a YoY basis.
• Overall, net cash flows for the company during FY20 stood at Rs 219 million from the Rs -265 million net cash flows seen during FY19.

BERGER PAINTS Cash Flow Statement 2019-20

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-19	Mar-20
Cash Flow from Operating Activities	Rs m	6,108	7,246	18.6%
Cash Flow from Investing Activities	Rs m	-3,786	-2,234	-
Cash Flow from Financing Activities	Rs m	-2,588	-4,794	-
Net Cash Flow	Rs m	-265	219	-

Current Valuations for BERGER PAINTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.8, an improvement from the EPS of Rs 5.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 618.5, stands at 118.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 16.2 times, while the price to sales ratio stands at 6.8 times.
• The company's price to cash flow (P/CF) ratio stood at 70.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Sales per share (Unadj.)	Rs	62.4	65.5
TTM Earnings per share	Rs	5.1	6.8
Diluted earnings per share	Rs	5.1	6.8
Price to Cash Flow	x	88.7	70.2
TTM P/E ratio	x	118.4	118.4
Price / Book Value ratio	x	11.8	16.2
Market Cap	Rs m	600,582	600,576
Dividends per share (Unadj.)	Rs	1.9	2.2

Ratio Analysis for BERGER PAINTS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.5x during FY20, from 1.7x during FY19. 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 20.0x during FY20, from 17.3x during FY19. 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 FY20, from 20.0% during FY20. 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 32.0% during FY20, from 30.0% during FY19. 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 14.3% during FY20, from 11.8% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Current ratio	x	1.7	1.5
Debtors’ Days	Days	40	41
Interest coverage	x	17.3	20.0
Debt to equity ratio	x	0.1	0.1
Return on assets	%	11.8	14.3
Return on equity	%	20.0	24.7
Return on capital employed	%	30.0	32.0

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

BERGER PAINTS Share Price Performance

Over the last one year, BERGER PAINTS share price has moved up from Rs 499.1 to Rs 618.5, registering a gain of Rs 119.5 or around 23.9%.

Overall, the S&P BSE SENSEX is up 5.0% over the year.

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