FINOLEX INDUSTRIES 2020-21 Annual Report Analysis

Wed, 31 Mar

FINOLEX INDUSTRIES has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

FINOLEX INDUSTRIES Income Statement Analysis

• Operating income during the year rose 16.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 122.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 28.6% in FY21 as against 14.9% in FY20.
• Depreciation charges increased by 5.3% and finance costs decreased by 35.5% YoY, respectively.
• Other income grew by 119.2% YoY.
• Net profit for the year grew by 135.0% YoY.
• Net profit margins during the year grew from 10.3% in FY20 to 20.8% in FY21.

FINOLEX INDUSTRIES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	29,845	34,628	16.0%
Other income	Rs m	326	716	119.2%
Total Revenues	Rs m	30,172	35,344	17.1%
Gross profit	Rs m	4,447	9,893	122.5%
Depreciation	Rs m	738	777	5.3%
Interest	Rs m	113	73	-35.5%
Profit before tax	Rs m	3,923	9,759	148.8%
Tax	Rs m	852	2,543	198.5%
Profit after tax	Rs m	3,071	7,216	135.0%
Gross profit margin	%	14.9	28.6
Effective tax rate	%	21.7	26.1
Net profit margin	%	10.3	20.8

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FINOLEX INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 9 billion as compared to Rs 7 billion in FY20, thereby witnessing an increase of 35.4%.
• Current assets rose 62% and stood at Rs 20 billion, while fixed assets rose 38% and stood at Rs 23 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 43 billion as against Rs 29 billion during FY20, thereby witnessing a growth of 49%.

FINOLEX INDUSTRIES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	19,860	31,390	58.1
Current Liabilities	Rs m	6,914	9,362	35.4
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	28,913	42,939	48.5
Current assets	Rs m	12,243	19,879	62.4
Fixed Assets	Rs m	16,670	23,060	38.3
Total Assets	Rs m	28,913	42,939	48.5

FINOLEX INDUSTRIES Cash Flow Statement Analysis

• FINOLEX INDUSTRIES's cash flow from operating activities (CFO) during FY21 stood at Rs 9 billion, an improvement of 785.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -9 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -903 million, an improvement of 14% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -259 million from the Rs 508 million net cash flows seen during FY20.

FINOLEX INDUSTRIES Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	1,063	9,410	785.3%
Cash Flow from Investing Activities	Rs m	491	-8,766	-
Cash Flow from Financing Activities	Rs m	-1,047	-903	-
Net Cash Flow	Rs m	508	-259	-

Current Valuations for FINOLEX INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.6, an decline from the EPS of Rs 24.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 637.0, stands at 54.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 12.6 times, while the price to sales ratio stands at 11.4 times.
• The company's price to cash flow (P/CF) ratio stood at 40.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	240.5	55.8
TTM Earnings per share	Rs	24.7	11.6
Diluted earnings per share	Rs	4.9	11.6
Price to Cash Flow	x	63.6	40.8
TTM P/E ratio	x	78.9	54.8
Price / Book Value ratio	x	2.9	10.4
Market Cap	Rs m	56,960	325,968
Dividends per share (Unadj.)	Rs	2.0	4.0

Ratio Analysis for FINOLEX INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.1x during FY21, from 1.8x during FY20. 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 135.2x during FY21, from 35.8x during FY20. 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 23.0% during FY21, from 15.5% during FY21. 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 31.3% during FY21, from 20.3% during FY20. 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 17.0% during FY21, from 11.0% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.8	2.1
Debtors’ Days	Days	1	2
Interest coverage	x	35.8	135.2
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.0	17.0
Return on equity	%	15.5	23.0
Return on capital employed	%	20.3	31.3

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

FINOLEX INDUSTRIES Share Price Performance

Over the last one year, FINOLEX INDUSTRIES share price has moved up from Rs 390.7 to Rs 637.0, registering a gain of Rs 246.3 or around 63.0%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of FINOLEX INDUSTRIES