ORIENTAL AROMATICS 2022-23 Annual Report Analysis

Tue, 20 Feb

ORIENTAL AROMATICS 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.

ORIENTAL AROMATICS Income Statement Analysis

• Operating income during the year fell 2.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 41.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.4% in FY23 as against 10.7% in FY22.
• Depreciation charges increased by 14.2% and finance costs increased by 222.2% YoY, respectively.
• Other income grew by 31.9% YoY.
• Net profit for the year declined by 63.0% YoY.
• Net profit margins during the year declined from 6.1% in FY22 to 2.3% in FY23.

ORIENTAL AROMATICS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	8,688	8,491	-2.3%
Other income	Rs m	44	58	31.9%
Total Revenues	Rs m	8,732	8,549	-2.1%
Gross profit	Rs m	925	541	-41.5%
Depreciation	Rs m	170	194	14.2%
Interest	Rs m	40	130	222.2%
Profit before tax	Rs m	759	275	-63.8%
Tax	Rs m	226	77	-65.7%
Profit after tax	Rs m	533	197	-63.0%
Gross profit margin	%	10.7	6.4
Effective tax rate	%	29.8	28.2
Net profit margin	%	6.1	2.3

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ORIENTAL AROMATICS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 3 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 60.6%.
• Long-term debt down at Rs 316 million as compared to Rs 450 million during FY22, a fall of 29.7%.
• Current assets rose 15% and stood at Rs 6 billion, while fixed assets rose 12% and stood at Rs 3 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 10 billion as against Rs 9 billion during FY22, thereby witnessing a growth of 14%.

ORIENTAL AROMATICS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	6,052	6,249	3.3
Current Liabilities	Rs m	1,857	2,981	60.6
Long-term Debt	Rs m	450	316	-29.7
Total Liabilities	Rs m	8,649	9,865	14.1
Current assets	Rs m	5,551	6,396	15.2
Fixed Assets	Rs m	3,098	3,468	12.0
Total Assets	Rs m	8,649	9,865	14.1

ORIENTAL AROMATICS Cash Flow Statement Analysis

• ORIENTAL AROMATICS's cash flow from operating activities (CFO) during FY23 stood at Rs -223 million, an improvement of 2,639.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -465 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 781 million, an improvement of 52% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 94 million from the Rs -88 million net cash flows seen during FY22.

ORIENTAL AROMATICS 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	-8	-223	-
Cash Flow from Investing Activities	Rs m	-594	-465	-
Cash Flow from Financing Activities	Rs m	515	781	51.8%
Net Cash Flow	Rs m	-88	94	-

Current Valuations for ORIENTAL AROMATICS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.9, an decline from the EPS of Rs 15.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 351.8, stands at 60.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 1.4 times.
• The company's price to cash flow (P/CF) ratio stood at 44.9 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	258.2	252.3
TTM Earnings per share	Rs	15.8	5.9
Diluted earnings per share	Rs	15.8	5.9
Price to Cash Flow	x	33.8	44.9
TTM P/E ratio	x	44.6	60.0
Price / Book Value ratio	x	4.8	2.8
Market Cap	Rs m	28,826	17,582
Dividends per share (Unadj.)	Rs	1.5	0.5

Ratio Analysis for ORIENTAL AROMATICS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.1x during FY23, from 3.0x 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 deteriorated and stood at 3.1x during FY23, from 19.8x 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 declined and down at 3.2% during FY23, from 8.8% 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 declined and down at 6.2% during FY23, from 12.3% 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 declined and down at 3.3% during FY23, from 6.6% 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	3.0	2.1
Debtors’ Days	Days	818	817
Interest coverage	x	19.8	3.1
Debt to equity ratio	x	0.1	0.1
Return on assets	%	6.6	3.3
Return on equity	%	8.8	3.2
Return on capital employed	%	12.3	6.2

To see how ORIENTAL AROMATICS has performed over the last 5 years, please visit here.

ORIENTAL AROMATICS Share Price Performance

Over the last one year, ORIENTAL AROMATICS share price has moved down from Rs 705.7 to Rs 351.8, registering a loss of Rs 354.0 or around 50.2%.

Overall, the S&P BSE SENSEX is up 1.8% over the year.

(To know more, check out historical annual results for ORIENTAL AROMATICS and quarterly results for ORIENTAL AROMATICS)