GMDC 2017-18 Annual Report Analysis

Sat, 31 Mar

GMDC has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

GMDC Income Statement Analysis

• Operating income during the year rose 36.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 31.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 27.0% in FY18 as against 28.1% in FY17.
• Depreciation charges decreased by 21.3% and finance costs increased by 22.5% YoY, respectively.
• Other income declined by 33.1% YoY.
• Net profit for the year grew by 31.3% YoY.
• Net profit margins during the year declined from 21.8% in FY17 to 21.0% in FY18.

GMDC Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	14,909	20,319	36.3%
Other income	Rs m	1,815	1,213	-33.1%
Total Revenues	Rs m	16,724	21,532	28.7%
Gross profit	Rs m	4,184	5,492	31.3%
Depreciation	Rs m	1,513	1,190	-21.3%
Interest	Rs m	13	16	22.5%
Profit before tax	Rs m	4,473	5,499	22.9%
Tax	Rs m	1,218	1,223	0.5%
Profit after tax	Rs m	3,255	4,276	31.3%
Gross profit margin	%	28.1	27.0
Effective tax rate	%	27.2	22.2
Net profit margin	%	21.8	21.0

Download Now: 7 Unstoppable Growth Engines of India's $10 Trillion Bull Run...

GMDC Balance Sheet Analysis

• The company's current liabilities during FY18 down at Rs 4 billion as compared to Rs 4 billion in FY17, thereby witnessing an decrease of -5.8%.
• Current assets rose 2% and stood at Rs 15 billion, while fixed assets rose 7% and stood at Rs 39 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 54 billion as against Rs 51 billion during FY17, thereby witnessing a growth of 5%.

GMDC Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	40,006	43,511	8.8
Current Liabilities	Rs m	4,373	4,118	-5.8
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	51,141	53,901	5.4
Current assets	Rs m	14,412	14,669	1.8
Fixed Assets	Rs m	36,730	39,232	6.8
Total Assets	Rs m	51,141	53,901	5.4

GMDC Cash Flow Statement Analysis

• GMDC's cash flow from operating activities (CFO) during FY18 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -970 million, an improvement of 16% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 64 million from the Rs -126 million net cash flows seen during FY17.

GMDC Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	4,525	2,409	-46.8%
Cash Flow from Investing Activities	Rs m	-3,503	-1,375	-
Cash Flow from Financing Activities	Rs m	-1,149	-970	-
Net Cash Flow	Rs m	-126	64	-

Current Valuations for GMDC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.4, an improvement from the EPS of Rs 10.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 123.4, stands at 9.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.9 times, while the price to sales ratio stands at 1.9 times.
• The company's price to cash flow (P/CF) ratio stood at 8.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	46.9	63.9
TTM Earnings per share	Rs	10.2	13.4
Diluted earnings per share	Rs	10.2	13.4
Price to Cash Flow	x	8.2	8.7
TTM P/E ratio	x	12.4	9.8
Price / Book Value ratio	x	0.8	1.1
Market Cap	Rs m	30,242	47,811
Dividends per share (Unadj.)	Rs	3.0	3.5

Ratio Analysis for GMDC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.6x during FY18, from 3.3x during FY17. 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 338.6x during FY18, from 337.3x during FY17. 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 9.8% during FY18, from 8.1% during FY18. 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 12.7% during FY18, from 11.2% during FY17. 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 8.0% during FY18, from 6.4% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	3.3	3.6
Debtors’ Days	Days	291	200
Interest coverage	x	337.3	338.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.4	8.0
Return on equity	%	8.1	9.8
Return on capital employed	%	11.2	12.7

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

GMDC Share Price Performance

Over the last one year, GMDC share price has moved up from Rs 122.8 to Rs 123.4, registering a gain of Rs 0.6 or around 0.5%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of GMDC