CONFIDENCE PETROLEUM 2022-23 Annual Report Analysis

Tue, 26 Sep

CONFIDENCE PETROLEUM 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.

CONFIDENCE PETROLEUM Income Statement Analysis

• Operating income during the year rose 54.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 20.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 10.3% in FY23 as against 13.2% in FY22.
• Depreciation charges increased by 27.4% and finance costs increased by 127.0% YoY, respectively.
• Other income declined by 28.8% YoY.
• Net profit for the year grew by 0.7% YoY.
• Net profit margins during the year declined from 6.1% in FY22 to 4.0% in FY23.

CONFIDENCE PETROLEUM Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	14,277	22,088	54.7%
Other income	Rs m	64	46	-28.8%
Total Revenues	Rs m	14,341	22,134	54.3%
Gross profit	Rs m	1,883	2,268	20.4%
Depreciation	Rs m	668	851	27.4%
Interest	Rs m	116	263	127.0%
Profit before tax	Rs m	1,164	1,200	3.1%
Tax	Rs m	288	318	10.5%
Profit after tax	Rs m	876	881	0.7%
Gross profit margin	%	13.2	10.3
Effective tax rate	%	24.8	26.5
Net profit margin	%	6.1	4.0

Download Now: 7 Unstoppable Growth Engines of India's $10 Trillion Bull Run...

CONFIDENCE PETROLEUM Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 3 billion as compared to Rs 808 million in FY22, thereby witnessing an increase of 245.1%.
• Long-term debt stood at Rs 3 billion as compared to Rs 420 million during FY22, a growth of 585.4%.
• Current assets rose 170% and stood at Rs 8 billion, while fixed assets rose 12% and stood at Rs 9 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 16 billion as against Rs 11 billion during FY22, thereby witnessing a growth of 56%.

CONFIDENCE PETROLEUM Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	6,944	8,128	17.1
Current Liabilities	Rs m	808	2,787	245.1
Long-term Debt	Rs m	420	2,875	585.4
Total Liabilities	Rs m	10,505	16,421	56.3
Current assets	Rs m	2,926	7,907	170.2
Fixed Assets	Rs m	7,579	8,515	12.3
Total Assets	Rs m	10,505	16,421	56.3

CONFIDENCE PETROLEUM Cash Flow Statement Analysis

• CONFIDENCE PETROLEUM's cash flow from operating activities (CFO) during FY23 stood at Rs -1 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion, an improvement of 0.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 4 billion, an improvement of 416% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 512 million from the Rs 30 million net cash flows seen during FY22.

CONFIDENCE PETROLEUM 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	1,029	-1,364	-
Cash Flow from Investing Activities	Rs m	-1,692	-1,696	-
Cash Flow from Financing Activities	Rs m	692	3,573	416.0%
Net Cash Flow	Rs m	30	512	1,624.2%

Current Valuations for CONFIDENCE PETROLEUM

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.1, an improvement from the EPS of Rs 3.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 86.6, stands at 23.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.0 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 11.0 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	50.3	77.8
TTM Earnings per share	Rs	3.1	3.1
Diluted earnings per share	Rs	3.1	3.1
Price to Cash Flow	x	11.5	11.0
TTM P/E ratio	x	20.3	23.0
Price / Book Value ratio	x	2.7	2.3
Market Cap	Rs m	18,922	19,000
Dividends per share (Unadj.)	Rs	0.1	0.1

Ratio Analysis for CONFIDENCE PETROLEUM

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.8x during FY23, from 3.6x 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 deteriorated and stood at 5.6x during FY23, from 11.1x 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 declined and down at 10.8% during FY23, from 12.6% 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 declined and down at 13.3% during FY23, from 17.4% 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 declined and down at 7.0% during FY23, from 9.4% 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	3.6	2.8
Debtors’ Days	Days	174	215
Interest coverage	x	11.1	5.6
Debt to equity ratio	x	0.1	0.4
Return on assets	%	9.4	7.0
Return on equity	%	12.6	10.8
Return on capital employed	%	17.4	13.3

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

CONFIDENCE PETROLEUM Share Price Performance

Over the last one year, CONFIDENCE PETROLEUM share price has moved up from Rs 71.4 to Rs 86.6, registering a gain of Rs 15.2 or around 21.3%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 19,011.2 (up 0.2%). Over the last one year it has moved up from 18,466.8 to 19,011.2, a gain of 544 points (up 2.9%).

Overall, the S&P BSE SENSEX is up 11.5% over the year.

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