ORIENTAL CARBON 2022-23 Annual Report Analysis

Mon, 10 Jul

ORIENTAL CARBON 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 CARBON Income Statement Analysis

• Operating income during the year rose 20.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 24.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 20.5% in FY23 as against 19.8% in FY22.
• Depreciation charges increased by 21.5% and finance costs increased by 56.2% YoY, respectively.
• Other income declined by 61.0% YoY.
• Net profit for the year grew by 16.0% YoY.
• Net profit margins during the year declined from 10.4% in FY22 to 10.0% in FY23.

ORIENTAL CARBON Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	4,437	5,359	20.8%
Other income	Rs m	80	31	-61.0%
Total Revenues	Rs m	4,518	5,390	19.3%
Gross profit	Rs m	878	1,097	24.9%
Depreciation	Rs m	242	294	21.5%
Interest	Rs m	83	130	56.2%
Profit before tax	Rs m	633	704	11.2%
Tax	Rs m	171	168	-1.9%
Profit after tax	Rs m	462	536	16.0%
Gross profit margin	%	19.8	20.5
Effective tax rate	%	27.0	23.9
Net profit margin	%	10.4	10.0

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ORIENTAL CARBON Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 1 billion as compared to Rs 2 billion in FY22, thereby witnessing an decrease of -8.9%.
• Long-term debt down at Rs 734 million as compared to Rs 941 million during FY22, a fall of 22.1%.
• Current assets rose 4% and stood at Rs 3 billion, while fixed assets rose 1% and stood at Rs 6 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 9 billion as against Rs 9 billion during FY22, thereby witnessing a growth of 2%.

ORIENTAL CARBON Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	5,609	6,023	7.4
Current Liabilities	Rs m	1,551	1,412	-8.9
Long-term Debt	Rs m	941	734	-22.1
Total Liabilities	Rs m	8,654	8,859	2.4
Current assets	Rs m	2,883	3,012	4.5
Fixed Assets	Rs m	5,771	5,848	1.3
Total Assets	Rs m	8,654	8,859	2.4

ORIENTAL CARBON Cash Flow Statement Analysis

• ORIENTAL CARBON's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 71.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -540 million, an improvement of 31.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -523 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -12 million from the Rs -4 million net cash flows seen during FY22.

ORIENTAL CARBON 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	611	1,051	71.9%
Cash Flow from Investing Activities	Rs m	-410	-540	-
Cash Flow from Financing Activities	Rs m	-205	-523	-
Net Cash Flow	Rs m	-4	-12	-

Current Valuations for ORIENTAL CARBON

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 53.6, an improvement from the EPS of Rs 46.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 835.7, stands at 15.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.4 times, while the price to sales ratio stands at 1.6 times.
• The company's price to cash flow (P/CF) ratio stood at 9.9 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	444.2	536.4
TTM Earnings per share	Rs	46.2	53.6
Diluted earnings per share	Rs	46.2	53.6
Price to Cash Flow	x	11.4	9.9
TTM P/E ratio	x	17.3	15.6
Price / Book Value ratio	x	1.8	1.4
Market Cap	Rs m	10,350	8,196
Dividends per share (Unadj.)	Rs	14.0	14.0

Ratio Analysis for ORIENTAL CARBON

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.1x during FY23, from 1.9x 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 6.4x during FY23, from 8.6x 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 8.9% during FY23, from 8.2% 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 12.3% during FY23, from 10.9% 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 7.5% during FY23, from 6.3% 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	1.9	2.1
Debtors’ Days	Days	712	555
Interest coverage	x	8.6	6.4
Debt to equity ratio	x	0.2	0.1
Return on assets	%	6.3	7.5
Return on equity	%	8.2	8.9
Return on capital employed	%	10.9	12.3

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

ORIENTAL CARBON Share Price Performance

Over the last one year, ORIENTAL CARBON share price has moved up from Rs 820.4 to Rs 835.7, registering a gain of Rs 15.4 or around 1.9%.

Overall, the S&P BSE SENSEX is up 23.0% over the year.

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