ESAB INDIA 2022-23 Annual Report Analysis

Mon, 17 Jul

ESAB INDIA 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.

ESAB INDIA Income Statement Analysis

• Operating income during the year rose 21.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 54.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.9% in FY23 as against 13.3% in FY22.
• Depreciation charges increased by 4.9% and finance costs decreased by 18.0% YoY, respectively.
• Other income grew by 66.7% YoY.
• Net profit for the year grew by 60.9% YoY.
• Net profit margins during the year grew from 9.3% in FY22 to 12.3% in FY23.

ESAB INDIA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	9,078	11,044	21.6%
Other income	Rs m	47	78	66.7%
Total Revenues	Rs m	9,125	11,122	21.9%
Gross profit	Rs m	1,208	1,869	54.7%
Depreciation	Rs m	113	119	4.9%
Interest	Rs m	6	5	-18.0%
Profit before tax	Rs m	1,136	1,823	60.5%
Tax	Rs m	293	466	59.4%
Profit after tax	Rs m	843	1,357	60.9%
Gross profit margin	%	13.3	16.9
Effective tax rate	%	25.8	25.6
Net profit margin	%	9.3	12.3

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ESAB INDIA Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 9.8%.
• Current assets rose 4% and stood at Rs 3 billion, while fixed assets rose 24% and stood at Rs 1 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 5 billion as against Rs 4 billion during FY22, thereby witnessing a growth of 9%.

ESAB INDIA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	2,442	2,603	6.6
Current Liabilities	Rs m	1,855	2,036	9.8
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	4,345	4,729	8.8
Current assets	Rs m	3,342	3,491	4.5
Fixed Assets	Rs m	982	1,218	24.0
Total Assets	Rs m	4,345	4,729	8.8

ESAB INDIA Cash Flow Statement Analysis

• ESAB INDIA's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 52.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 52 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 122 million from the Rs 26 million net cash flows seen during FY22.

ESAB INDIA 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	845	1,292	52.9%
Cash Flow from Investing Activities	Rs m	200	52	-74.1%
Cash Flow from Financing Activities	Rs m	-1,019	-1,222	-
Net Cash Flow	Rs m	26	122	365.4%

Current Valuations for ESAB INDIA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 88.2, an improvement from the EPS of Rs 54.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 4,406.1, stands at 50.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 26.1 times, while the price to sales ratio stands at 6.1 times.
• The company's price to cash flow (P/CF) ratio stood at 38.2 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	589.9	717.6
TTM Earnings per share	Rs	54.8	88.2
Diluted earnings per share	Rs	54.8	88.1
Price to Cash Flow	x	48.8	38.2
TTM P/E ratio	x	55.4	50.0
Price / Book Value ratio	x	16.9	21.7
Market Cap	Rs m	41,253	56,358
Dividends per share (Unadj.)	Rs	60.0	78.0

Ratio Analysis for ESAB INDIA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY23, from 1.8x 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 365.6x during FY23, from 187.2x 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 52.1% during FY23, from 34.5% 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 70.2% during FY23, from 46.7% 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 28.8% during FY23, from 19.5% 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	1.8	1.7
Debtors’ Days	Days	544	501
Interest coverage	x	187.2	365.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	19.5	28.8
Return on equity	%	34.5	52.1
Return on capital employed	%	46.7	70.2

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

ESAB INDIA Share Price Performance

Over the last one year, ESAB INDIA share price has moved up from Rs 3,332.2 to Rs 4,406.1, registering a gain of Rs 1,073.9 or around 32.2%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 41,426.7 (up 0.2%). Over the last one year it has moved up from 27,634.8 to 41,426.7, a gain of 13,792 points (up 49.9%).

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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