CARBORUNDUM UNIVERSAL 2017-18 Annual Report Analysis

Sat, 31 Mar

CARBORUNDUM UNIVERSAL has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

CARBORUNDUM UNIVERSAL Income Statement Analysis

• Operating income during the year rose 17.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 21.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 17.0% in FY18 as against 16.5% in FY17.
• Depreciation charges increased by 9.9% and finance costs decreased by 52.5% YoY, respectively.
• Other income declined by 20.0% YoY.
• Net profit for the year grew by 24.4% YoY.
• Net profit margins during the year grew from 8.3% in FY17 to 8.8% in FY18.

CARBORUNDUM UNIVERSAL Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	19,926	23,404	17.5%
Other income	Rs m	286	229	-20.0%
Total Revenues	Rs m	20,213	23,633	16.9%
Gross profit	Rs m	3,287	3,986	21.3%
Depreciation	Rs m	965	1,060	9.9%
Interest	Rs m	181	86	-52.5%
Profit before tax	Rs m	2,428	3,070	26.4%
Tax	Rs m	781	1,020	30.7%
Profit after tax	Rs m	1,647	2,049	24.4%
Gross profit margin	%	16.5	17.0
Effective tax rate	%	32.2	33.2
Net profit margin	%	8.3	8.8

CARBORUNDUM UNIVERSAL Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 4 billion as compared to Rs 4 billion in FY17, thereby witnessing an increase of 1.3%.
• Long-term debt down at Rs 66 million as compared to Rs 67 million during FY17, a fall of 0.7%.
• Current assets rose 19% and stood at Rs 12 billion, while fixed assets fell 1% and stood at Rs 9 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 21 billion as against Rs 19 billion during FY17, thereby witnessing a growth of 9%.

CARBORUNDUM UNIVERSAL Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	13,812	15,612	13.0
Current Liabilities	Rs m	4,131	4,186	1.3
Long-term Debt	Rs m	67	66	-0.7
Total Liabilities	Rs m	19,132	20,876	9.1
Current assets	Rs m	9,710	11,552	19.0
Fixed Assets	Rs m	9,423	9,323	-1.1
Total Assets	Rs m	19,132	20,876	9.1

CARBORUNDUM UNIVERSAL Cash Flow Statement Analysis

• CARBORUNDUM UNIVERSAL's cash flow from operating activities (CFO) during FY18 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -748 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -832 million, an improvement of 60% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 549 million from the Rs 162 million net cash flows seen during FY17.

CARBORUNDUM UNIVERSAL Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	2,953	2,130	-27.9%
Cash Flow from Investing Activities	Rs m	-813	-748	-
Cash Flow from Financing Activities	Rs m	-2,071	-832	-
Net Cash Flow	Rs m	162	549	238.3%

Current Valuations for CARBORUNDUM UNIVERSAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.8, an improvement from the EPS of Rs 8.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 347.5, stands at 31.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.2 times, while the price to sales ratio stands at 2.8 times.
• The company's price to cash flow (P/CF) ratio stood at 21.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	105.6	123.9
TTM Earnings per share	Rs	8.7	10.8
Diluted earnings per share	Rs	8.7	10.8
Price to Cash Flow	x	21.2	21.7
TTM P/E ratio	x	32.3	31.9
Price / Book Value ratio	x	3.2	4.3
Market Cap	Rs m	44,844	67,424
Dividends per share (Unadj.)	Rs	1.8	2.3

Ratio Analysis for CARBORUNDUM UNIVERSAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.8x during FY18, from 2.4x during FY17. 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 36.6x during FY18, from 14.4x during FY17. 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 13.1% during FY18, from 11.9% during FY18. 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 20.1% during FY18, from 18.8% during FY17. 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 10.2% during FY18, from 9.6% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	2.4	2.8
Debtors’ Days	Days	70	74
Interest coverage	x	14.4	36.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.6	10.2
Return on equity	%	11.9	13.1
Return on capital employed	%	18.8	20.1

To see how CARBORUNDUM UNIVERSAL has performed over the last 5 years, please visit here.

CARBORUNDUM UNIVERSAL Share Price Performance

Over the last one year, CARBORUNDUM UNIVERSAL share price has moved up from Rs 291.0 to Rs 347.5, registering a gain of Rs 56.5 or around 19.4%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,476.7 (down 0.1%). Over the last one year it has moved up from 16,446.0 to 18,476.7, a gain of 2,031 points (up 12.3%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for CARBORUNDUM UNIVERSAL and quarterly results for CARBORUNDUM UNIVERSAL)

Read: Latest Annual Report Analysis of CARBORUNDUM UNIVERSAL