EPL 2022-23 Annual Report Analysis

Thu, 13 Jul

EPL 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.

EPL Income Statement Analysis

• Operating income during the year fell 64.8% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 63.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 17.3% in FY23 as against 16.8% in FY22.
• Depreciation charges decreased by 56.6% and finance costs decreased by 44.9% YoY, respectively.
• Other income grew by 920.8% YoY.
• Net profit for the year declined by 10.0% YoY.
• Net profit margins during the year grew from 6.7% in FY22 to 17.0% in FY23.

EPL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	34,328	12,086	-64.8%
Other income	Rs m	120	1,225	920.8%
Total Revenues	Rs m	34,448	13,311	-61.4%
Gross profit	Rs m	5,761	2,091	-63.7%
Depreciation	Rs m	2,514	1,092	-56.6%
Interest	Rs m	403	222	-44.9%
Profit before tax	Rs m	2,964	2,002	-32.5%
Tax	Rs m	675	-57	NA
Profit after tax	Rs m	2,289	2,059	-10.0%
Gross profit margin	%	16.8	17.3
Effective tax rate	%	22.8	-2.8
Net profit margin	%	6.7	17.0

Download Now: 7 Unstoppable Growth Engines of India's $10 Trillion Bull Run...

EPL Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 3 billion as compared to Rs 9 billion in FY22, thereby witnessing an decrease of -68.1%.
• Long-term debt down at Rs 1 billion as compared to Rs 4 billion during FY22, a fall of 70.2%.
• Current assets fell 71% and stood at Rs 4 billion, while fixed assets fell 38% and stood at Rs 14 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 18 billion as against Rs 38 billion during FY22, thereby witnessing a fall of 51%.

EPL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	18,018	8,670	-51.9
Current Liabilities	Rs m	8,998	2,870	-68.1
Long-term Debt	Rs m	3,620	1,080	-70.2
Total Liabilities	Rs m	37,569	18,257	-51.4
Current assets	Rs m	15,388	4,457	-71.0
Fixed Assets	Rs m	22,181	13,800	-37.8
Total Assets	Rs m	37,569	18,257	-51.4

EPL Cash Flow Statement Analysis

• EPL's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -152 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 74 million from the Rs -497 million net cash flows seen during FY22.

EPL 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	3,117	2,472	-20.7%
Cash Flow from Investing Activities	Rs m	-2,642	-152	-
Cash Flow from Financing Activities	Rs m	-954	-2,246	-
Net Cash Flow	Rs m	-497	74	-

Current Valuations for EPL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.5, an decline from the EPS of Rs 7.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 219.3, stands at 29.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 8.0 times, while the price to sales ratio stands at 5.8 times.
• The company's price to cash flow (P/CF) ratio stood at 17.4 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	108.7	38.0
TTM Earnings per share	Rs	7.2	6.5
Diluted earnings per share	Rs	7.2	6.5
Price to Cash Flow	x	12.8	17.4
TTM P/E ratio	x	26.9	29.9
Price / Book Value ratio	x	3.9	6.3
Market Cap	Rs m	69,957	54,812
Dividends per share (Unadj.)	Rs	4.3	4.3

Ratio Analysis for EPL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.6x during FY23, from 1.7x 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 10.0x during FY23, from 8.4x 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 23.7% during FY23, from 12.7% 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 22.8% during FY23, from 15.6% 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 12.5% during FY23, from 7.2% 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	1.7	1.6
Debtors’ Days	Days	68	69
Interest coverage	x	8.4	10.0
Debt to equity ratio	x	0.2	0.1
Return on assets	%	7.2	12.5
Return on equity	%	12.7	23.7
Return on capital employed	%	15.6	22.8

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

EPL Share Price Performance

Over the last one year, EPL share price has moved up from Rs 169.2 to Rs 219.3, registering a gain of Rs 50.1 or around 29.6%.

Overall, the S&P BSE SENSEX is up 20.2% over the year.

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