GUJARAT ALKALIES 2020-21 Annual Report Analysis

Wed, 31 Mar

GUJARAT ALKALIES 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.

GUJARAT ALKALIES Income Statement Analysis

• Operating income during the year fell 10.8% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 38.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 14.7% in FY21 as against 21.2% in FY20.
• Depreciation charges increased by 7.7% and finance costs increased by 10.1% YoY, respectively.
• Other income declined by 24.9% YoY.
• Net profit for the year declined by 49.9% YoY.
• Net profit margins during the year declined from 12.2% in FY20 to 6.9% in FY21.

GUJARAT ALKALIES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	27,246	24,295	-10.8%
Other income	Rs m	898	675	-24.9%
Total Revenues	Rs m	28,144	24,969	-11.3%
Gross profit	Rs m	5,777	3,582	-38.0%
Depreciation	Rs m	1,618	1,744	7.7%
Interest	Rs m	140	155	10.1%
Profit before tax	Rs m	4,916	2,358	-52.0%
Tax	Rs m	1,588	690	-56.6%
Profit after tax	Rs m	3,328	1,669	-49.9%
Gross profit margin	%	21.2	14.7
Effective tax rate	%	32.3	29.2
Net profit margin	%	12.2	6.9

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GUJARAT ALKALIES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 6 billion as compared to Rs 5 billion in FY20, thereby witnessing an increase of 15.8%.
• Long-term debt stood at Rs 4 billion as compared to Rs 1 billion during FY20, a growth of 216.1%.
• Current assets fell 21% and stood at Rs 11 billion, while fixed assets rose 34% and stood at Rs 61 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 72 billion as against Rs 59 billion during FY20, thereby witnessing a growth of 21%.

GUJARAT ALKALIES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	45,957	53,747	17.0
Current Liabilities	Rs m	5,280	6,114	15.8
Long-term Debt	Rs m	1,371	4,333	216.1
Total Liabilities	Rs m	58,909	71,545	21.4
Current assets	Rs m	13,720	10,886	-20.7
Fixed Assets	Rs m	45,189	60,659	34.2
Total Assets	Rs m	58,909	71,545	21.4

GUJARAT ALKALIES Cash Flow Statement Analysis

• GUJARAT ALKALIES's cash flow from operating activities (CFO) during FY21 stood at Rs 4 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -3 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 2 billion, an improvement of 255% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 3 billion from the Rs -1 billion net cash flows seen during FY20.

GUJARAT ALKALIES 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	6,297	4,212	-33.1%
Cash Flow from Investing Activities	Rs m	-6,345	-3,324	-
Cash Flow from Financing Activities	Rs m	-1,459	2,261	-
Net Cash Flow	Rs m	-1,498	3,128	-

Current Valuations for GUJARAT ALKALIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 22.7, an decline from the EPS of Rs 45.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 344.6, stands at 15.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.5 times, while the price to sales ratio stands at 1.0 times.
• The company's price to cash flow (P/CF) ratio stood at 6.6 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	371.0	330.8
TTM Earnings per share	Rs	45.3	22.7
Diluted earnings per share	Rs	45.3	22.7
Price to Cash Flow	x	3.3	6.6
TTM P/E ratio	x	4.9	15.2
Price / Book Value ratio	x	0.6	0.4
Market Cap	Rs m	27,935	22,374
Dividends per share (Unadj.)	Rs	8.0	8.0

Ratio Analysis for GUJARAT ALKALIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY21, from 2.6x 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 deteriorated and stood at 16.3x during FY21, from 36.0x 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 declined and down at 3.1% during FY21, from 7.2% 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 declined and down at 4.3% during FY21, from 10.7% 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 declined and down at 2.5% during FY21, from 5.9% 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	2.6	1.8
Debtors’ Days	Days	501	434
Interest coverage	x	36.0	16.3
Debt to equity ratio	x	0.0	0.1
Return on assets	%	5.9	2.5
Return on equity	%	7.2	3.1
Return on capital employed	%	10.7	4.3

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

GUJARAT ALKALIES Share Price Performance

Over the last one year, GUJARAT ALKALIES share price has moved up from Rs 223.4 to Rs 344.6, registering a gain of Rs 121.2 or around 54.3%.

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

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

Read: Latest Annual Report Analysis of GUJARAT ALKALIES