GANDHI SPECIAL TUBES 2020-21 Annual Report Analysis

Wed, 31 Mar

GANDHI SPECIAL TUBES 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.

GANDHI SPECIAL TUBES Income Statement Analysis

• Operating income during the year rose 40.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 88.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 39.5% in FY21 as against 29.4% in FY20.
• Depreciation charges decreased by 7.3% and finance costs increased by 8.2% YoY, respectively.
• Other income grew by 4.9% YoY.
• Net profit for the year grew by 69.1% YoY.
• Net profit margins during the year grew from 26.4% in FY20 to 31.8% in FY21.

GANDHI SPECIAL TUBES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	809	1,135	40.3%
Other income	Rs m	58	61	4.9%
Total Revenues	Rs m	868	1,197	37.9%
Gross profit	Rs m	238	448	88.2%
Depreciation	Rs m	36	33	-7.3%
Interest	Rs m	1	1	8.2%
Profit before tax	Rs m	260	476	82.8%
Tax	Rs m	47	114	145.3%
Profit after tax	Rs m	214	362	69.1%
Gross profit margin	%	29.4	39.5
Effective tax rate	%	17.9	24.0
Net profit margin	%	26.4	31.8

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GANDHI SPECIAL TUBES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 109 million as compared to Rs 49 million in FY20, thereby witnessing an increase of 121.6%.
• Current assets rose 58% and stood at Rs 1 billion, while fixed assets fell 15% and stood at Rs 741 million in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 2 billion as against Rs 2 billion during FY20, thereby witnessing a growth of 19%.

GANDHI SPECIAL TUBES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	1,466	1,719	17.3
Current Liabilities	Rs m	49	109	121.6
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	1,617	1,924	19.0
Current assets	Rs m	747	1,183	58.4
Fixed Assets	Rs m	870	741	-14.8
Total Assets	Rs m	1,617	1,924	19.0

GANDHI SPECIAL TUBES Cash Flow Statement Analysis

• GANDHI SPECIAL TUBES's cash flow from operating activities (CFO) during FY21 stood at Rs 324 million, an improvement of 74.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -200 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -117 million, an improvement of 85% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 7 million from the Rs -14 million net cash flows seen during FY20.

GANDHI SPECIAL TUBES 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	186	324	74.4%
Cash Flow from Investing Activities	Rs m	560	-200	-
Cash Flow from Financing Activities	Rs m	-760	-117	-
Net Cash Flow	Rs m	-14	7	-

Current Valuations for GANDHI SPECIAL TUBES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 28.0, an improvement from the EPS of Rs 16.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 266.0, stands at 8.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 3.0 times.
• The company's price to cash flow (P/CF) ratio stood at 7.8 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	62.6	87.9
TTM Earnings per share	Rs	16.5	28.0
Diluted earnings per share	Rs	17.6	29.7
Price to Cash Flow	x	10.0	7.8
TTM P/E ratio	x	11.7	8.9
Price / Book Value ratio	x	2.4	1.8
Market Cap	Rs m	3,557	3,076
Dividends per share (Unadj.)	Rs	9.0	9.0

Ratio Analysis for GANDHI SPECIAL TUBES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 10.8x during FY21, from 15.2x 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 improved and stood at 721.7x during FY21, from 427.7x 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 improved and stood at 21.0% during FY21, from 14.6% 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 improved and stood at 27.7% during FY21, from 17.8% 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 improved and stood at 18.8% during FY21, from 13.3% 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	15.2	10.8
Debtors’ Days	Days	664	819
Interest coverage	x	427.7	721.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.3	18.8
Return on equity	%	14.6	21.0
Return on capital employed	%	17.8	27.7

To see how GANDHI SPECIAL TUBES has performed over the last 5 years, please visit here.

GANDHI SPECIAL TUBES Share Price Performance

Over the last one year, GANDHI SPECIAL TUBES share price has moved up from Rs 205.0 to Rs 266.0, registering a gain of Rs 61.0 or around 29.8%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 14,350.6 (up 0.4%). Over the last one year it has moved up from 5,713.3 to 14,350.6, a gain of 8,637 points (up 151.2%).

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

(To know more, check out historical annual results for GANDHI SPECIAL TUBES and quarterly results for GANDHI SPECIAL TUBES)

Read: Latest Annual Report Analysis of GANDHI SPECIAL TUBES