KANSAI NEROLAC 2019-20 Annual Report Analysis

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KANSAI NEROLAC 2019-20 Annual Report Analysis
Tue, 29 Dec

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 109.0% 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 8.2% in FY19 to 9.7% 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 7,526 8,045 6.9%
Depreciation Rs m 1,063 1,421 33.7%
Interest Rs m 100 209 109.0%
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 % 35.7 22.7
Net profit margin % 8.2 9.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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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 17% and stood at Rs 21 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 17,814 20,755 16.5
Total Assets Rs m 45,179 48,836 8.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, 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 -345 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 -345 782 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, 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 574.3, stands at 78.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 6.2 times, while the price to sales ratio stands at 4.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 47.0 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 55.9 47.0
TTM P/E ratio x 78.3 78.3
Price / Book Value ratio x 7.0 6.2
Market Cap Rs m 309,463 309,521
Dividends per share (Unadj.) Rs 2.6 3.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, 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 70.7x 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 51 54
Interest coverage x 70.7 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: Company Reports, Regulatory Filings, 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 up from Rs 515.5 to Rs 574.3, registering a gain of Rs 58.8 or around 11.4%.

Overall, the S&P BSE SENSEX is up 14.3% over the year.

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

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For the quarter ended December 2020, KANSAI NEROLAC has posted a net profit of Rs 2 bn (up 64.6% YoY). Sales on the other hand came in at Rs 15 bn (up 18.0% YoY). Read on for a complete analysis of KANSAI NEROLAC's quarterly results.

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KANSAI NEROLAC 2018-19 Annual Report Analysis (Annual Result Update)

May 30, 2019 | Updated on May 30, 2019

Here's an analysis of the annual report of KANSAI NEROLAC for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of KANSAI NEROLAC. Also includes updates on the valuation of KANSAI NEROLAC.

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