FINOLEX INDUSTRIES 2022-23 Annual Report Analysis

Mon, 14 Aug

FINOLEX INDUSTRIES 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.

FINOLEX INDUSTRIES Income Statement Analysis

• Operating income during the year fell 5.4% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 77.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.2% in FY23 as against 30.1% in FY22.
• Depreciation charges increased by 7.0% and finance costs increased by 93.3% YoY, respectively.
• Other income grew by 47.1% YoY.
• Net profit for the year declined by 76.2% YoY.
• Net profit margins during the year declined from 22.6% in FY22 to 5.7% in FY23.

FINOLEX INDUSTRIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	46,473	43,971	-5.4%
Other income	Rs m	822	1,209	47.1%
Total Revenues	Rs m	47,296	45,180	-4.5%
Gross profit	Rs m	13,983	3,168	-77.3%
Depreciation	Rs m	834	892	7.0%
Interest	Rs m	141	272	93.3%
Profit before tax	Rs m	13,831	3,213	-76.8%
Tax	Rs m	3,317	706	-78.7%
Profit after tax	Rs m	10,514	2,507	-76.2%
Gross profit margin	%	30.1	7.2
Effective tax rate	%	24.0	22.0
Net profit margin	%	22.6	5.7

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FINOLEX INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 11 billion as compared to Rs 12 billion in FY22, thereby witnessing an decrease of -5.2%.
• Current assets fell 5% and stood at Rs 29 billion, while fixed assets rose 48% and stood at Rs 34 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 63 billion as against Rs 53 billion during FY22, thereby witnessing a growth of 18%.

FINOLEX INDUSTRIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	39,278	49,031	24.8
Current Liabilities	Rs m	11,989	11,360	-5.2
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	53,454	62,851	17.6
Current assets	Rs m	30,460	28,924	-5.0
Fixed Assets	Rs m	22,994	33,927	47.5
Total Assets	Rs m	53,454	62,851	17.6

FINOLEX INDUSTRIES Cash Flow Statement Analysis

• FINOLEX INDUSTRIES's cash flow from operating activities (CFO) during FY23 stood at Rs 3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -3 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -289 million, an improvement of 85% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -150 million from the Rs -79 million net cash flows seen during FY22.

FINOLEX INDUSTRIES 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	6,220	3,017	-51.5%
Cash Flow from Investing Activities	Rs m	-4,403	-2,877	-
Cash Flow from Financing Activities	Rs m	-1,895	-289	-
Net Cash Flow	Rs m	-79	-150	-

Current Valuations for FINOLEX INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.1, an decline from the EPS of Rs 16.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 204.6, stands at 54.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.6 times, while the price to sales ratio stands at 2.9 times.
• The company's price to cash flow (P/CF) ratio stood at 29.4 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	74.9	71.1
TTM Earnings per share	Rs	16.9	4.1
Diluted earnings per share	Rs	16.9	4.0
Price to Cash Flow	x	8.5	29.4
TTM P/E ratio	x	9.1	54.5
Price / Book Value ratio	x	6.7	2.0
Market Cap	Rs m	264,153	99,842
Dividends per share (Unadj.)	Rs	4.0	1.5

Ratio Analysis for FINOLEX INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.5x during FY23, from 2.5x 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 deteriorated and stood at 12.8x during FY23, from 99.2x 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 declined and down at 5.1% during FY23, from 26.8% 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 declined and down at 7.1% during FY23, from 35.6% 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 declined and down at 4.4% during FY23, from 19.9% 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	2.5	2.5
Debtors’ Days	Days	3	2
Interest coverage	x	99.2	12.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	19.9	4.4
Return on equity	%	26.8	5.1
Return on capital employed	%	35.6	7.1

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 143.1 to Rs 204.6, registering a gain of Rs 61.5 or around 43.0%.

Overall, the S&P BSE SENSEX is up 10.5% over the year.

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