BLUE STAR 2022-23 Annual Report Analysis

Wed, 12 Jul

BLUE STAR 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.

BLUE STAR Income Statement Analysis

• Operating income during the year rose 31.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 81.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 7.9% in FY23 as against 5.7% in FY22.
• Depreciation charges decreased by 1.4% and finance costs increased by 17.9% YoY, respectively.
• Other income grew by 77.0% YoY.
• Net profit for the year grew by 138.5% YoY.
• Net profit margins during the year grew from 2.8% in FY22 to 5.0% in FY23.

BLUE STAR Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	60,641	79,773	31.6%
Other income	Rs m	357	632	77.0%
Total Revenues	Rs m	60,998	80,405	31.8%
Gross profit	Rs m	3,476	6,316	81.7%
Depreciation	Rs m	860	848	-1.4%
Interest	Rs m	464	547	17.9%
Profit before tax	Rs m	2,509	5,554	121.4%
Tax	Rs m	829	1,547	86.6%
Profit after tax	Rs m	1,680	4,007	138.5%
Gross profit margin	%	5.7	7.9
Effective tax rate	%	33.0	27.9
Net profit margin	%	2.8	5.0

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BLUE STAR Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 38 billion as compared to Rs 30 billion in FY22, thereby witnessing an increase of 27.4%.
• Long-term debt down at Rs 2 billion as compared to Rs 2 billion during FY22, a fall of 33.0%.
• Current assets rose 22% and stood at Rs 43 billion, while fixed assets rose 42% and stood at Rs 11 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 54 billion as against Rs 43 billion during FY22, thereby witnessing a growth of 26%.

BLUE STAR Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	10,176	13,307	30.8
Current Liabilities	Rs m	29,692	37,838	27.4
Long-term Debt	Rs m	2,416	1,617	-33.0
Total Liabilities	Rs m	42,851	53,911	25.8
Current assets	Rs m	34,834	42,506	22.0
Fixed Assets	Rs m	8,016	11,405	42.3
Total Assets	Rs m	42,851	53,911	25.8

BLUE STAR Cash Flow Statement Analysis

• BLUE STAR's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 183.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion, an improvement of 163.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -911 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -223 million from the Rs -623 million net cash flows seen during FY22.

BLUE STAR 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	874	2,474	183.0%
Cash Flow from Investing Activities	Rs m	-690	-1,817	-
Cash Flow from Financing Activities	Rs m	-824	-911	-
Net Cash Flow	Rs m	-623	-223	-

Current Valuations for BLUE STAR

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 41.6, an improvement from the EPS of Rs 17.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 785.5, stands at 37.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 11.4 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 11.9 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	629.6	828.3
TTM Earnings per share	Rs	17.4	41.6
Diluted earnings per share	Rs	8.7	20.8
Price to Cash Flow	x	39.9	11.9
TTM P/E ratio	x	60.6	37.8
Price / Book Value ratio	x	8.9	4.3
Market Cap	Rs m	90,292	57,674
Dividends per share (Unadj.)	Rs	10.0	12.0

Ratio Analysis for BLUE STAR

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.1x during FY23, from 1.2x 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 11.2x during FY23, from 6.4x 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 30.1% during FY23, from 16.5% 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 40.9% during FY23, from 23.6% 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 8.4% during FY23, from 5.0% 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	1.2	1.1
Debtors’ Days	Days	7	7
Interest coverage	x	6.4	11.2
Debt to equity ratio	x	0.2	0.1
Return on assets	%	5.0	8.4
Return on equity	%	16.5	30.1
Return on capital employed	%	23.6	40.9

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

BLUE STAR Share Price Performance

Over the last one year, BLUE STAR share price has moved up from Rs 472.3 to Rs 785.5, registering a gain of Rs 313.2 or around 66.3%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 43,243.8 (down 0.1%). Over the last one year it has moved up from 37,236.5 to 43,243.8, a gain of 6,007 points (up 16.1%).

Overall, the S&P BSE SENSEX is up 20.5% over the year.

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