EIMCO ELECON 2018-19 Annual Report Analysis

Sun, 31 Mar

EIMCO ELECON has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

EIMCO ELECON Income Statement Analysis

• Operating income during the year rose 33.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 67.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.5% in FY19 as against 10.9% in FY18.
• Depreciation charges decreased by 0.3% and finance costs increased by 5.4% YoY, respectively.
• Other income grew by 9.5% YoY.
• Net profit for the year grew by 41.2% YoY.
• Net profit margins during the year grew from 11.9% in FY18 to 12.6% in FY19.

EIMCO ELECON Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	1,380	1,847	33.9%
Other income	Rs m	100	109	9.5%
Total Revenues	Rs m	1,480	1,957	32.2%
Gross profit	Rs m	150	250	67.1%
Depreciation	Rs m	50	50	-0.3%
Interest	Rs m	5	6	5.4%
Profit before tax	Rs m	194	304	56.5%
Tax	Rs m	30	72	140.7%
Profit after tax	Rs m	164	232	41.2%
Gross profit margin	%	10.9	13.5
Effective tax rate	%	15.4	23.7
Net profit margin	%	11.9	12.6

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EIMCO ELECON Balance Sheet Analysis

• The company's current liabilities during FY19 down at Rs 277 million as compared to Rs 334 million in FY18, thereby witnessing an decrease of -17.0%.
• Long-term debt stood at Rs 13 million as compared to Rs 6 million during FY18, a growth of 104.4%.
• Current assets fell 32% and stood at Rs 1 billion, while fixed assets rose 41% and stood at Rs 3 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 4 billion as against Rs 4 billion during FY18, thereby witnessing a growth of 5%.

EIMCO ELECON Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	2,946	3,143	6.7
Current Liabilities	Rs m	334	277	-17.0
Long-term Debt	Rs m	6	13	104.4
Total Liabilities	Rs m	3,530	3,722	5.5
Current assets	Rs m	1,730	1,184	-31.6
Fixed Assets	Rs m	1,799	2,538	41.1
Total Assets	Rs m	3,530	3,722	5.5

EIMCO ELECON Cash Flow Statement Analysis

• EIMCO ELECON's cash flow from operating activities (CFO) during FY19 stood at Rs 101 million, an improvement of 2.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -80 million, an improvement of 54.8% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -25 million, an improvement of 13% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -5 million from the Rs 17 million net cash flows seen during FY18.

EIMCO ELECON Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	98	101	2.7%
Cash Flow from Investing Activities	Rs m	-52	-80	-
Cash Flow from Financing Activities	Rs m	-29	-25	-
Net Cash Flow	Rs m	17	-5	-

Current Valuations for EIMCO ELECON

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 40.2, an improvement from the EPS of Rs 28.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 387.0, stands at 9.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 1.2 times.
• The company's price to cash flow (P/CF) ratio stood at 8.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	239.2	320.2
TTM Earnings per share	Rs	28.5	40.2
Diluted earnings per share	Rs	28.5	40.2
Price to Cash Flow	x	11.2	8.2
TTM P/E ratio	x	14.7	9.6
Price / Book Value ratio	x	1.1	0.7
Market Cap	Rs m	3,170	2,322
Dividends per share (Unadj.)	Rs	5.0	7.0

Ratio Analysis for EIMCO ELECON

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 4.3x during FY19, from 5.2x during FY18. 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 54.5x during FY19, from 37.0x during FY18. 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 7.4% during FY19, from 5.6% during FY19. 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 9.8% during FY19, from 6.8% during FY18. 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 6.4% during FY19, from 4.8% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	5.2	4.3
Debtors’ Days	Days	1,590	1,199
Interest coverage	x	37.0	54.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	4.8	6.4
Return on equity	%	5.6	7.4
Return on capital employed	%	6.8	9.8

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

EIMCO ELECON Share Price Performance

Over the last one year, EIMCO ELECON share price has moved down from Rs 415.1 to Rs 387.0, registering a loss of Rs 28.1 or around 6.8%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,472.0 (up 0.5%). Over the last one year it has moved down from 18,476.7 to 18,472.0, a loss of 5 points (down 0.0%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Read: Latest Annual Report Analysis of EIMCO ELECON