ELGI EQUIPMENTS 2022-23 Annual Report Analysis

Wed, 12 Jul

ELGI EQUIPMENTS 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.

ELGI EQUIPMENTS Income Statement Analysis

• Operating income during the year rose 20.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 83.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 17.9% in FY23 as against 11.8% in FY22.
• Depreciation charges increased by 4.3% and finance costs increased by 61.5% YoY, respectively.
• Other income grew by 22.3% YoY.
• Net profit for the year grew by 107.8% YoY.
• Net profit margins during the year grew from 7.1% in FY22 to 12.2% in FY23.

ELGI EQUIPMENTS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	25,247	30,407	20.4%
Other income	Rs m	550	672	22.3%
Total Revenues	Rs m	25,797	31,079	20.5%
Gross profit	Rs m	2,975	5,450	83.2%
Depreciation	Rs m	745	777	4.3%
Interest	Rs m	149	241	61.5%
Profit before tax	Rs m	2,630	5,104	94.0%
Tax	Rs m	846	1,396	65.0%
Profit after tax	Rs m	1,784	3,708	107.8%
Gross profit margin	%	11.8	17.9
Effective tax rate	%	32.2	27.3
Net profit margin	%	7.1	12.2

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ELGI EQUIPMENTS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 10 billion as compared to Rs 8 billion in FY22, thereby witnessing an increase of 26.7%.
• Long-term debt down at Rs 216 million as compared to Rs 578 million during FY22, a fall of 62.6%.
• Current assets rose 39% and stood at Rs 18 billion, while fixed assets rose 5% and stood at Rs 6 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 25 billion as against Rs 19 billion during FY22, thereby witnessing a growth of 27%.

ELGI EQUIPMENTS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	10,312	13,694	32.8
Current Liabilities	Rs m	8,060	10,211	26.7
Long-term Debt	Rs m	578	216	-62.6
Total Liabilities	Rs m	19,474	24,704	26.9
Current assets	Rs m	13,103	18,237	39.2
Fixed Assets	Rs m	6,139	6,466	5.3
Total Assets	Rs m	19,474	24,704	26.9

ELGI EQUIPMENTS Cash Flow Statement Analysis

• ELGI EQUIPMENTS's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 142.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 598 million, an improvement of 174% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 84 million from the Rs -107 million net cash flows seen during FY22.

ELGI EQUIPMENTS 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	686	1,659	142.0%
Cash Flow from Investing Activities	Rs m	19	-2,173	-
Cash Flow from Financing Activities	Rs m	-812	598	-
Net Cash Flow	Rs m	-107	84	-

Current Valuations for ELGI EQUIPMENTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.7, an improvement from the EPS of Rs 5.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 603.4, stands at 51.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 14.0 times, while the price to sales ratio stands at 6.3 times.
• The company's price to cash flow (P/CF) ratio stood at 28.8 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	79.7	95.9
TTM Earnings per share	Rs	5.6	11.7
Diluted earnings per share	Rs	5.6	11.7
Price to Cash Flow	x	35.0	28.8
TTM P/E ratio	x	50.0	51.9
Price / Book Value ratio	x	9.4	9.4
Market Cap	Rs m	96,570	129,196
Dividends per share (Unadj.)	Rs	1.2	2.0

Ratio Analysis for ELGI EQUIPMENTS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.8x during FY23, from 1.6x 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 improved and stood at 22.1x during FY23, from 18.6x 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 27.1% during FY23, from 17.3% 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 38.4% during FY23, from 25.5% 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 16.0% during FY23, from 9.9% 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	1.6	1.8
Debtors’ Days	Days	68	66
Interest coverage	x	18.6	22.1
Debt to equity ratio	x	0.1	0.0
Return on assets	%	9.9	16.0
Return on equity	%	17.3	27.1
Return on capital employed	%	25.5	38.4

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

ELGI EQUIPMENTS Share Price Performance

Over the last one year, ELGI EQUIPMENTS share price has moved up from Rs 372.6 to Rs 603.4, registering a gain of Rs 230.8 or around 61.9%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 41,348.5 (up 0.1%). Over the last one year it has moved up from 27,225.4 to 41,348.5, a gain of 14,123 points (up 51.9%).

Overall, the S&P BSE SENSEX is up 20.5% over the year.

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