EIH 2021-22 Annual Report Analysis

Mon, 22 Aug

EIH 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.

EIH Income Statement Analysis

• Operating income during the year rose 99.6% 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 5.5% in FY22 as against 57.9% in FY21.
• Depreciation charges decreased by 3.8% and finance costs decreased by 15.9% YoY, respectively.
• Other income grew by 10.0% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 61.3% in FY21 to 4.9% in FY22.

EIH Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	4,935	9,853	99.6%
Other income	Rs m	535	588	10.0%
Total Revenues	Rs m	5,470	10,441	90.9%
Gross profit	Rs m	-2,857	539	NA
Depreciation	Rs m	1,293	1,243	-3.8%
Interest	Rs m	415	349	-15.9%
Profit before tax	Rs m	-4,030	-465	NA
Tax	Rs m	-1,006	17	NA
Profit after tax	Rs m	-3,025	-483	NA
Gross profit margin	%	-57.9	5.5
Effective tax rate	%	25.0	-3.7
Net profit margin	%	-61.3	-4.9

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EIH Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 6 billion as compared to Rs 4 billion in FY21, thereby witnessing an increase of 52.4%.
• Long-term debt down at Rs 2 billion as compared to Rs 3 billion during FY21, a fall of 35.1%.
• Current assets rose 47% and stood at Rs 7 billion, while fixed assets fell 5% and stood at Rs 35 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 42 billion as against Rs 41 billion during FY21, thereby witnessing a growth of 1%.

EIH Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	31,044	30,267	-2.5
Current Liabilities	Rs m	4,085	6,227	52.4
Long-term Debt	Rs m	2,546	1,652	-35.1
Total Liabilities	Rs m	41,322	41,749	1.0
Current assets	Rs m	4,556	6,698	47.0
Fixed Assets	Rs m	36,765	35,051	-4.7
Total Assets	Rs m	41,322	41,749	1.0

EIH Cash Flow Statement Analysis

• EIH's cash flow from operating activities (CFO) during FY22 stood at Rs -187 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs 235 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs 203 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 251 million from the Rs -225 million net cash flows seen during FY21.

EIH 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	-1,394	-187	-
Cash Flow from Investing Activities	Rs m	-527	235	-
Cash Flow from Financing Activities	Rs m	1,696	203	-88.0%
Net Cash Flow	Rs m	-225	251	-

Current Valuations for EIH

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -0.8, an improvement from the EPS of Rs -4.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 154.0, stands at 84.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.2 times, while the price to sales ratio stands at 9.8 times.
• The company's price to cash flow (P/CF) ratio stood at 100.4 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	7.9	15.8
TTM Earnings per share	Rs	-4.8	-0.8
Diluted earnings per share	Rs	-4.8	-0.8
Price to Cash Flow	x	-33.5	100.4
TTM P/E ratio	x	-18.6	84.9
Price / Book Value ratio	x	1.7	2.5
Market Cap	Rs m	52,280	76,294
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for EIH

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.1x during FY22, from 1.1x 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 -0.3x during FY22, from -8.7x 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 -1.6% during FY22, from -9.7% 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 -0.4% during FY22, from -10.8% 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 -0.3% during FY22, from -6.3% 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	1.1	1.1
Debtors’ Days	Days	58	43
Interest coverage	x	-8.7	-0.3
Debt to equity ratio	x	0.1	0.1
Return on assets	%	-6.3	-0.3
Return on equity	%	-9.7	-1.6
Return on capital employed	%	-10.8	-0.4

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

EIH Share Price Performance

Over the last one year, EIH share price has moved up from Rs 102.4 to Rs 154.0, registering a gain of Rs 51.6 or around 50.4%.

Overall, the S&P BSE SENSEX is up 5.9% over the year.

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

Read: Latest Annual Report Analysis of EIH