EMAMI PAPER MILLS 2021-22 Annual Report Analysis

Sat, 20 Aug

EMAMI PAPER MILLS 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.

EMAMI PAPER MILLS Income Statement Analysis

• Operating income during the year rose 61.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 23.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 15.7% in FY22 as against 20.5% in FY21.
• Depreciation charges increased by 2.4% and finance costs decreased by 13.6% YoY, respectively.
• Other income declined by 90.2% YoY.
• Net profit for the year grew by 124.8% YoY.
• Net profit margins during the year grew from 4.2% in FY21 to 5.9% in FY22.

EMAMI PAPER MILLS Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	12,163	19,577	61.0%
Other income	Rs m	209	21	-90.2%
Total Revenues	Rs m	12,372	19,598	58.4%
Gross profit	Rs m	2,497	3,080	23.3%
Depreciation	Rs m	721	739	2.4%
Interest	Rs m	958	828	-13.6%
Profit before tax	Rs m	1,026	1,534	49.5%
Tax	Rs m	516	386	-25.2%
Profit after tax	Rs m	511	1,148	124.8%
Gross profit margin	%	20.5	15.7
Effective tax rate	%	50.2	25.2
Net profit margin	%	4.2	5.9

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EMAMI PAPER MILLS Balance Sheet Analysis

• The company's current liabilities during FY22 down at Rs 6 billion as compared to Rs 7 billion in FY21, thereby witnessing an decrease of -14.4%.
• Long-term debt down at Rs 3 billion as compared to Rs 4 billion during FY21, a fall of 14.2%.
• Current assets rose 6% and stood at Rs 5 billion, while fixed assets fell 3% and stood at Rs 13 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 18 billion as against Rs 18 billion during FY21, thereby witnessing a fall of 1%.

EMAMI PAPER MILLS Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	5,395	6,530	21.1
Current Liabilities	Rs m	7,421	6,350	-14.4
Long-term Debt	Rs m	4,051	3,476	-14.2
Total Liabilities	Rs m	17,883	17,789	-0.5
Current assets	Rs m	4,986	5,275	5.8
Fixed Assets	Rs m	12,897	12,514	-3.0
Total Assets	Rs m	17,883	17,789	-0.5

EMAMI PAPER MILLS Cash Flow Statement Analysis

• EMAMI PAPER MILLS's cash flow from operating activities (CFO) during FY22 stood at Rs 3 billion, an improvement of 33.5% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -337 million, an improvement of 364.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs -118 million from the Rs -72 million net cash flows seen during FY21.

EMAMI PAPER MILLS 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	2,463	3,288	33.5%
Cash Flow from Investing Activities	Rs m	-73	-337	-
Cash Flow from Financing Activities	Rs m	-2,463	-3,068	-
Net Cash Flow	Rs m	-72	-118	-

Current Valuations for EMAMI PAPER MILLS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.0, an improvement from the EPS of Rs 8.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 169.0, stands at 7.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.6 times, while the price to sales ratio stands at 0.5 times.
• The company's price to cash flow (P/CF) ratio stood at 5.0 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	201.0	323.6
TTM Earnings per share	Rs	8.4	19.0
Diluted earnings per share	Rs	8.4	19.0
Price to Cash Flow	x	6.1	5.0
TTM P/E ratio	x	14.6	7.5
Price / Book Value ratio	x	1.1	1.4
Market Cap	Rs m	6,088	9,376
Dividends per share (Unadj.)	Rs	0.0	1.6

Ratio Analysis for EMAMI PAPER MILLS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.8x during FY22, from 0.7x 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 2.9x during FY22, from 2.1x 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 17.6% during FY22, from 9.5% 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 23.6% during FY22, from 21.0% 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 11.1% during FY22, from 8.2% 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	0.7	0.8
Debtors’ Days	Days	6	4
Interest coverage	x	2.1	2.9
Debt to equity ratio	x	0.8	0.5
Return on assets	%	8.2	11.1
Return on equity	%	9.5	17.6
Return on capital employed	%	21.0	23.6

To see how EMAMI PAPER MILLS has performed over the last 5 years, please visit here.

EMAMI PAPER MILLS Share Price Performance

Over the last one year, EMAMI PAPER MILLS share price has moved down from Rs 177.1 to Rs 169.0, registering a loss of Rs 8.1 or around 4.6%.

Overall, the S&P BSE SENSEX is up 7.2% over the year.

(To know more, check out historical annual results for EMAMI PAPER MILLS and quarterly results for EMAMI PAPER MILLS)

Read: Latest Annual Report Analysis of EMAMI PAPER MILLS