DEEPAK FERTILISERS 2022-23 Annual Report Analysis

Mon, 14 Aug

DEEPAK FERTILISERS 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.

DEEPAK FERTILISERS Income Statement Analysis

• Operating income during the year rose 47.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 59.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.2% in FY23 as against 17.7% in FY22.
• Depreciation charges increased by 2.9% and finance costs increased by 25.8% YoY, respectively.
• Other income grew by 91.3% YoY.
• Net profit for the year grew by 77.6% YoY.
• Net profit margins during the year grew from 9.0% in FY22 to 10.8% in FY23.

DEEPAK FERTILISERS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	76,633	113,007	47.5%
Other income	Rs m	439	840	91.3%
Total Revenues	Rs m	77,072	113,847	47.7%
Gross profit	Rs m	13,560	21,654	59.7%
Depreciation	Rs m	2,325	2,392	2.9%
Interest	Rs m	1,548	1,947	25.8%
Profit before tax	Rs m	10,125	18,155	79.3%
Tax	Rs m	3,251	5,946	82.9%
Profit after tax	Rs m	6,875	12,209	77.6%
Gross profit margin	%	17.7	19.2
Effective tax rate	%	32.1	32.8
Net profit margin	%	9.0	10.8

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DEEPAK FERTILISERS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 28 billion as compared to Rs 22 billion in FY22, thereby witnessing an increase of 25.7%.
• Long-term debt stood at Rs 32 billion as compared to Rs 23 billion during FY22, a growth of 39.2%.
• Current assets rose 44% and stood at Rs 44 billion, while fixed assets rose 24% and stood at Rs 70 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 114 billion as against Rs 87 billion during FY22, thereby witnessing a growth of 31%.

DEEPAK FERTILISERS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	38,842	50,670	30.5
Current Liabilities	Rs m	22,410	28,174	25.7
Long-term Debt	Rs m	23,214	32,310	39.2
Total Liabilities	Rs m	87,050	114,212	31.2
Current assets	Rs m	30,377	43,841	44.3
Fixed Assets	Rs m	56,673	70,372	24.2
Total Assets	Rs m	87,050	114,212	31.2

DEEPAK FERTILISERS Cash Flow Statement Analysis

• DEEPAK FERTILISERS's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -10 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 6 billion, an improvement of 173% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 1 billion from the Rs 29 million net cash flows seen during FY22.

DEEPAK FERTILISERS 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	12,110	4,931	-59.3%
Cash Flow from Investing Activities	Rs m	-14,296	-9,788	-
Cash Flow from Financing Activities	Rs m	2,215	6,039	172.7%
Net Cash Flow	Rs m	29	1,182	3,960.5%

Current Valuations for DEEPAK FERTILISERS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 96.7, an improvement from the EPS of Rs 57.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 541.5, stands at 7.6 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 0.6 times.
• The company's price to cash flow (P/CF) ratio stood at 6.8 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	635.5	895.2
TTM Earnings per share	Rs	57.0	96.7
Diluted earnings per share	Rs	54.3	96.4
Price to Cash Flow	x	7.7	6.8
TTM P/E ratio	x	10.4	7.6
Price / Book Value ratio	x	1.4	2.0
Market Cap	Rs m	53,266	99,381
Dividends per share (Unadj.)	Rs	9.0	10.0

Ratio Analysis for DEEPAK FERTILISERS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY23, from 1.4x 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 improved and stood at 10.3x during FY23, from 7.5x 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 24.1% during FY23, from 17.7% 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 24.2% during FY23, from 18.8% 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 12.4% during FY23, from 9.7% 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	1.4	1.6
Debtors’ Days	Days	295	546
Interest coverage	x	7.5	10.3
Debt to equity ratio	x	0.6	0.6
Return on assets	%	9.7	12.4
Return on equity	%	17.7	24.1
Return on capital employed	%	18.8	24.2

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

DEEPAK FERTILISERS Share Price Performance

Over the last one year, DEEPAK FERTILISERS share price has moved down from Rs 864.3 to Rs 541.5, registering a loss of Rs 322.8 or around 37.4%.

Overall, the S&P BSE SENSEX is up 10.5% over the year.

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