DECCAN CEMENTS 2020-21 Annual Report Analysis

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DECCAN CEMENTS 2020-21 Annual Report Analysis
Fri, 29 Oct

DECCAN CEMENTS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

DECCAN CEMENTS Income Statement Analysis

  • Operating income during the year rose 36.5% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 155.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.2% in FY21 as against 12.4% in FY20.
  • Depreciation charges increased by 10.8% and finance costs increased by 8.0% YoY, respectively.
  • Other income grew by 5.7% YoY.
  • Net profit for the year grew by 103.2% YoY.
  • Net profit margins during the year grew from 10.0% in FY20 to 15.0% in FY21.

DECCAN CEMENTS Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 5,553 7,580 36.5%
Other income Rs m 96 101 5.7%
Total Revenues Rs m 5,649 7,681 36.0%
Gross profit Rs m 689 1,760 155.4%
Depreciation Rs m 209 232 10.8%
Interest Rs m 70 76 8.0%
Profit before tax Rs m 505 1,554 207.4%
Tax Rs m -61 402 -759.1%
Profit after tax Rs m 566 1,151 103.2%
Gross profit margin % 12.4 23.2
Effective tax rate % -12.1 25.9
Net profit margin % 10.0 15.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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DECCAN CEMENTS Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 2 billion as compared to Rs 1 billion in FY20, thereby witnessing an increase of 35.6%.
  • Long-term debt down at Rs 518 million as compared to Rs 668 million during FY20, a fall of 22.5%.
  • Current assets rose 47% and stood at Rs 4 billion, while fixed assets rose 7% and stood at Rs 5 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 9 billion as against Rs 7 billion during FY20, thereby witnessing a growth of 21%.

DECCAN CEMENTS Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 4,499 5,650 25.6
 
Current Liabilities Rs m 1,390 1,885 35.6
Long-term Debt Rs m 668 518 -22.5
Total Liabilities Rs m 7,105 8,615 21.3
 
Current assets Rs m 2,572 3,775 46.8
Fixed Assets Rs m 4,533 4,840 6.8
Total Assets Rs m 7,105 8,615 21.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



DECCAN CEMENTS Cash Flow Statement Analysis

  • DECCAN CEMENTS's cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion, an improvement of 326.3% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -321 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -86 million on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 1 billion from the Rs -146 million net cash flows seen during FY20.

DECCAN CEMENTS Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m 431 1,836 326.3%
Cash Flow from Investing Activities Rs m -898 -321 -
Cash Flow from Financing Activities Rs m 322 -86 -
Net Cash Flow Rs m -146 1,429 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for DECCAN CEMENTS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 82.2, an improvement from the EPS of Rs 40.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 708.1, stands at 7.9 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.8 times, while the price to sales ratio stands at 0.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 7.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 396.4 541.0
TTM Earnings per share Rs 40.4 82.2
Diluted earnings per share Rs 40.4 82.2
Price to Cash Flow x 12.8 7.2
TTM P/E ratio x 7.9 7.9
Price / Book Value ratio x 1.0 0.8
Market Cap Rs m 9,918 9,918
Dividends per share (Unadj.) Rs 4.0 5.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for DECCAN CEMENTS

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 2.0x during FY21, from 1.8x during FY20. 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 21.5x during FY21, from 8.2x during FY20. 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 20.4% during FY21, from 12.6% during FY21. 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 26.4% during FY21, from 11.1% during FY20. 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 14.2% during FY21, from 9.0% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 1.8 2.0
Debtors’ Days Days 314 121
Interest coverage x 8.2 21.5
Debt to equity ratio x 0.1 0.1
Return on assets % 9.0 14.2
Return on equity % 12.6 20.4
Return on capital employed % 11.1 26.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how DECCAN CEMENTS has performed over the last 5 years, please visit here.

DECCAN CEMENTS Share Price Performance

Over the last one year, DECCAN CEMENTS share price has moved up from Rs 310.5 to Rs 708.1, registering a gain of Rs 397.6 or around 128.1%.

Overall, the S&P BSE SENSEX is up 48.6% over the year.

(To know more, check out historical annual results for DECCAN CEMENTS and quarterly results for DECCAN CEMENTS)

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