DLF 2017-18 Annual Report Analysis

Sat, 31 Mar

DLF 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.

DLF Income Statement Analysis

• Operating income during the year fell 18.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 188.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 166.1% in FY18 as against 47.0% in FY17.
• Depreciation charges decreased by 6.8% and finance costs decreased by 1.0% YoY, respectively.
• Other income grew by 33.0% YoY.
• Net profit for the year grew by 436.4% YoY.
• Net profit margins during the year grew from 9.7% in FY17 to 64.0% in FY18.

DLF Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	82,212	67,068	-18.4%
Other income	Rs m	7,193	9,569	33.0%
Total Revenues	Rs m	89,405	76,637	-14.3%
Gross profit	Rs m	38,626	111,428	188.5%
Depreciation	Rs m	5,725	5,335	-6.8%
Interest	Rs m	29,798	29,507	-1.0%
Profit before tax	Rs m	10,295	86,155	736.8%
Tax	Rs m	2,293	43,231	1,785.6%
Profit after tax	Rs m	8,003	42,924	436.4%
Gross profit margin	%	47.0	166.1
Effective tax rate	%	22.3	50.2
Net profit margin	%	9.7	64.0

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DLF Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 171 billion as compared to Rs 135 billion in FY17, thereby witnessing an increase of 26.2%.
• Long-term debt down at Rs 62 billion as compared to Rs 233 billion during FY17, a fall of 73.2%.
• Current assets fell 1% and stood at Rs 295 billion, while fixed assets rose 4% and stood at Rs 311 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 606 billion as against Rs 596 billion during FY17, thereby witnessing a growth of 2%.

DLF Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	245,597	345,474	40.7
Current Liabilities	Rs m	135,377	170,858	26.2
Long-term Debt	Rs m	232,553	62,389	-73.2
Total Liabilities	Rs m	595,962	605,845	1.7
Current assets	Rs m	297,001	294,547	-0.8
Fixed Assets	Rs m	298,961	311,298	4.1
Total Assets	Rs m	595,962	605,845	1.7

DLF Cash Flow Statement Analysis

• DLF's cash flow from operating activities (CFO) during FY18 stood at Rs 3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -20 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -19 billion from the Rs 8 billion net cash flows seen during FY17.

DLF 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	-8,979	2,703	-
Cash Flow from Investing Activities	Rs m	8,716	-19,648	-
Cash Flow from Financing Activities	Rs m	7,871	-2,320	-
Net Cash Flow	Rs m	7,608	-19,265	-

Current Valuations for DLF

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 24.1, an improvement from the EPS of Rs 4.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 201.6, stands at 11.7 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 5.4 times.
• The company's price to cash flow (P/CF) ratio stood at 7.8 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	46.1	37.6
TTM Earnings per share	Rs	4.5	24.1
Diluted earnings per share	Rs	3.2	17.3
Price to Cash Flow	x	26.8	7.8
TTM P/E ratio	x	52.0	11.7
Price / Book Value ratio	x	1.0	1.1
Market Cap	Rs m	241,420	374,743
Dividends per share (Unadj.)	Rs	2.0	2.0

Ratio Analysis for DLF

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY18, from 2.2x 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 3.9x during FY18, from 1.3x 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 12.4% during FY18, from 3.3% 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 28.4% during FY18, from 8.4% 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 12.0% during FY18, from 6.3% 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	2.2	1.7
Debtors’ Days	Days	629	700
Interest coverage	x	1.3	3.9
Debt to equity ratio	x	0.9	0.2
Return on assets	%	6.3	12.0
Return on equity	%	3.3	12.4
Return on capital employed	%	8.4	28.4

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

DLF Share Price Performance

Over the last one year, DLF share price has moved up from Rs 148.7 to Rs 201.6, registering a gain of Rs 52.9 or around 35.5%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 2,229.9 (down 1.1%). Over the last one year it has moved up from 1,600.0 to 2,229.9, a gain of 630 points (up 39.4%).

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

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

Read: Latest Annual Report Analysis of DLF