DCM 2021-22 Annual Report Analysis

Tue, 11 Oct

DCM has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

DCM Income Statement Analysis

• Operating income during the year rose 47.2% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a fall and down at 11.6% in FY22 as against 8.1% in FY21.
• Depreciation charges decreased by 12.0% and finance costs decreased by 32.4% YoY, respectively.
• Other income grew by 765.1% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 37.6% in FY21 to 43.2% in FY22.

DCM Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	474	698	47.2%
Other income	Rs m	44	381	765.1%
Total Revenues	Rs m	518	1,078	108.2%
Gross profit	Rs m	-38	81	NA
Depreciation	Rs m	92	81	-12.0%
Interest	Rs m	87	59	-32.4%
Profit before tax	Rs m	-174	321	NA
Tax	Rs m	4	20	358.3%
Profit after tax	Rs m	-178	302	NA
Gross profit margin	%	-8.1	11.6
Effective tax rate	%	-2.5	6.2
Net profit margin	%	-37.6	43.2

DCM Balance Sheet Analysis

• The company's current liabilities during FY22 down at Rs 719 million as compared to Rs 1 billion in FY21, thereby witnessing an decrease of -37.1%.
• Current assets fell 10% and stood at Rs 485 million, while fixed assets fell 5% and stood at Rs 678 million in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 1 billion as against Rs 1 billion during FY21, thereby witnessing a fall of 7%.

DCM Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	-191	119	NA
Current Liabilities	Rs m	1,144	719	-37.1
Long-term Debt	Rs m	1	0	-100.0
Total Liabilities	Rs m	1,251	1,163	-7.0
Current assets	Rs m	539	485	-10.0
Fixed Assets	Rs m	712	678	-4.7
Total Assets	Rs m	1,251	1,163	-7.0

DCM Cash Flow Statement Analysis

• DCM's cash flow from operating activities (CFO) during FY22 stood at Rs 184 million, an improvement of 518.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs 7 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -151 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 40 million from the Rs -6 million net cash flows seen during FY21.

DCM Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	30	184	518.3%
Cash Flow from Investing Activities	Rs m	-25	7	-
Cash Flow from Financing Activities	Rs m	-10	-151	-
Net Cash Flow	Rs m	-6	40	-

Current Valuations for DCM

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 16.1, an improvement from the EPS of Rs -9.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 83.8, stands at 11.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 13.1 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 4.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	25.4	37.4
TTM Earnings per share	Rs	-9.6	16.1
Diluted earnings per share	Rs	-9.6	16.2
Price to Cash Flow	x	-5.3	4.1
TTM P/E ratio	x	-2.7	11.3
Price / Book Value ratio	x	-2.7	13.1
Market Cap	Rs m	511	1,569
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for DCM

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.7x during FY22, from 0.5x during FY21. 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 6.4x during FY22, from -1.0x during FY21. 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 252.7% during FY22, from 93.6% during FY22. 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 318.7% during FY22, from 45.8% during FY21. 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 31.0% during FY22, from -7.3% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	0.5	0.7
Debtors’ Days	Days	794	804
Interest coverage	x	-1.0	6.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	-7.3	31.0
Return on equity	%	93.6	252.7
Return on capital employed	%	45.8	318.7

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

DCM Share Price Performance

Over the last one year, DCM share price has moved up from Rs 52.9 to Rs 83.8, registering a gain of Rs 30.9 or around 58.4%.

Overall, the S&P BSE SENSEX is down 3.2% over the year.

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

Read: Latest Annual Report Analysis of DCM