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KANSAI NEROLAC 2019-20 Annual Report Analysis
Tue, 31 Mar

KANSAI NEROLAC has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

KANSAI NEROLAC Income Statement Analysis

  • Operating income during the year fell 2.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 6.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 15.2% in FY20 as against 13.9% in FY19.
  • Depreciation charges increased by 33.7% and finance costs increased by 109.7% YoY, respectively.
  • Other income declined by 57.8% YoY.
  • Net profit for the year grew by 15.2% YoY.
  • Net profit margins during the year grew from 8.3% in FY19 to 9.8% in FY20.

KANSAI NEROLAC Income Statement 2019-20

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Net Sales Rs m 54,243 52,800 -2.7%
Other income Rs m 605 255 -57.8%
Total Revenues Rs m 54,848 53,055 -3.3%
Gross profit Rs m 7,525 8,045 6.9%
Depreciation Rs m 1,063 1,421 33.7%
Interest Rs m 100 209 109.7%
Profit before tax Rs m 6,968 6,670 -4.3%
Tax Rs m 2,491 1,512 -39.3%
Profit after tax Rs m 4,477 5,158 15.2%
Gross profit margin % 13.9 15.2
Effective tax rate % 35.8 22.7
Net profit margin % 8.3 9.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



New Research: 2 stocks to buy as Nifty50 heads towards 40,000

KANSAI NEROLAC Balance Sheet Analysis

  • The company's current liabilities during FY20 down at Rs 9 billion as compared to Rs 10 billion in FY19, thereby witnessing an decrease of -3.5%.
  • Long-term debt stood at Rs 234 million as compared to Rs 44 million during FY19, a growth of 438.9%.
  • Current assets rose 7% and stood at Rs 25 billion, while fixed assets rose 9% and stood at Rs 24 billion in FY20.
  • Overall, the total assets and liabilities for FY20 stood at Rs 49 billion as against Rs 45 billion during FY19, thereby witnessing a growth of 8%.

KANSAI NEROLAC Balance Sheet as on March 2020

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Networth Rs m 34,163 37,603 10.1
 
Current Liabilities Rs m 9,504 9,172 -3.5
Long-term Debt Rs m 44 234 438.9
Total Liabilities Rs m 45,179 48,836 8.1
 
Current assets Rs m 23,204 24,885 7.2
Fixed Assets Rs m 21,975 23,951 9.0
Total Assets Rs m 45,179 48,836 8.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



KANSAI NEROLAC Cash Flow Statement Analysis

  • KANSAI NEROLAC's cash flow from operating activities (CFO) during FY20 stood at Rs 6 billion, an improvement of 495.5% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY20 stood at Rs -4 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY20 stood at Rs -1 billion, an improvement of 37% on a YoY basis.
  • Overall, net cash flows for the company during FY20 stood at Rs 782 million from the Rs -347 million net cash flows seen during FY19.

KANSAI NEROLAC Cash Flow Statement 2019-20

Particulars No. of months 12 12 % Change
Year Ending Mar-19 Mar-20
Cash Flow from Operating Activities Rs m 999 5,951 495.5%
Cash Flow from Investing Activities Rs m 885 -3,762 -
Cash Flow from Financing Activities Rs m -2,229 -1,407 -
Net Cash Flow Rs m -347 782 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for KANSAI NEROLAC

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.6, an improvement from the EPS of Rs 8.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 386.2, stands at 40.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 5.5 times, while the price to sales ratio stands at 3.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 35.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Sales per share (Unadj.) Rs 100.7 98.0
TTM Earnings per share Rs 8.3 9.6
Diluted earnings per share Rs 8.3 9.6
Price to Cash Flow x 44.5 35.6
TTM P/E ratio x 52.7 40.3
Price / Book Value ratio x 7.0 6.2
Market Cap Rs m 238,162 234,241
Dividends per share (Unadj.) Rs 2.6 3.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for KANSAI NEROLAC

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 2.7x during FY20, from 2.4x during FY19. 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 32.9x during FY20, from 70.9x during FY19. 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 13.7% during FY20, from 13.1% during FY20. 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 18.2% during FY20, from 20.7% during FY19. 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 11.0% during FY20, from 10.1% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Current ratio x 2.4 2.7
Debtors’ Days Days 5 5
Interest coverage x 70.9 32.9
Debt to equity ratio x 0.0 0.0
Return on assets % 10.1 11.0
Return on equity % 13.1 13.7
Return on capital employed % 20.7 18.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

KANSAI NEROLAC Share Price Performance

Over the last one year, KANSAI NEROLAC share price has moved down from Rs 457.3 to Rs 386.2, registering a loss of Rs 71.1 or around 15.5%.

Overall, the S&P BSE SENSEX is down 24.2% over the year.

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

Annual Report FAQs

What is the current share price of KANSAI NEROLAC?

KANSAI NEROLAC currently trades at Rs 262.3 per share. You can check out the latest share price performance of KANSAI NEROLAC here...

What was the revenue of KANSAI NEROLAC in FY20? How does it compare to earlier years?

The revenues of KANSAI NEROLAC stood at Rs 53,055 m in FY20, which was down -3.3% compared to Rs 54,848 m reported in FY19.

KANSAI NEROLAC's revenue has grown from Rs 32,874 m in FY16 to Rs 53,055 m in FY20.

Over the past 5 years, the revenue of KANSAI NEROLAC has grown at a CAGR of 12.7%.

What was the net profit of KANSAI NEROLAC in FY20? How does it compare to earlier years?

The net profit of KANSAI NEROLAC stood at Rs 5,158 m in FY20, which was up 15.2% compared to Rs 4,477 m reported in FY19.

This compares to a net profit of Rs 5,138 m in FY18 and a net profit of Rs 5,101 m in FY17.

Over the past 5 years, KANSAI NEROLAC net profit has grown at a CAGR of -13.0%.

What does the cash flow statement of KANSAI NEROLAC reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of KANSAI NEROLAC reveals:

  • Cash flow from operations increased in FY20 and stood at Rs 5,951 m as compared to Rs 999 m in FY19.
  • Cash flow from investments decreased in FY20 and stood at Rs -3,762 m as compared to Rs 885 m in FY19.
  • Cash flow from financial activity increased in FY20 and stood at Rs -1,407 m as compared to Rs -2,229 m in FY19.

Here's the cash flow statement of KANSAI NEROLAC for the past 5 years.

(Rs m)FY16FY17FY18FY19FY20
From Operations3,9173,5123,6009995,951
From Investments1,441-5,573-1,627885-3,762
From Financial Activity-918-2,162-1,916-2,229-1,407
Net Cashflow4,440-4,22657-347782

What does the Key Ratio analysis of KANSAI NEROLAC reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of KANSAI NEROLAC reveals:

  • Operating profit margins witnessed a fall and down at 15.2% in FY20 as against 13.9% in FY19.
  • Net profit margins grew from 8.3% in FY19 to 9.8% in FY20.
  • Debt to Equity ratio for FY20 stood at 0.0 as compared to 0.0 in FY19.

Here's the ratio/financial analysis of KANSAI NEROLAC for the past 5 years.

 FY16FY17FY18FY19FY20
Operating Profit Margin (%)34.320.917.613.915.2
Net Profit Margin (%)27.714.511.48.39.8
Debt to Equity Ratio (x)0.00.00.00.00.0

Read: Latest Annual Report Analysis of KANSAI NEROLAC

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