GULF OIL LUBRICANTS 2020-21 Annual Report Analysis

Wed, 31 Mar

GULF OIL LUBRICANTS 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.

GULF OIL LUBRICANTS Income Statement Analysis

• Operating income during the year rose 0.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 7.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 16.0% in FY21 as against 17.5% in FY20.
• Depreciation charges increased by 3.6% and finance costs decreased by 41.1% YoY, respectively.
• Other income grew by 50.6% YoY.
• Net profit for the year declined by 1.2% YoY.
• Net profit margins during the year declined from 12.3% in FY20 to 12.1% in FY21.

GULF OIL LUBRICANTS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	16,442	16,522	0.5%
Other income	Rs m	349	526	50.6%
Total Revenues	Rs m	16,790	17,048	1.5%
Gross profit	Rs m	2,872	2,647	-7.8%
Depreciation	Rs m	327	339	3.6%
Interest	Rs m	248	146	-41.1%
Profit before tax	Rs m	2,645	2,687	1.6%
Tax	Rs m	620	687	10.7%
Profit after tax	Rs m	2,025	2,001	-1.2%
Gross profit margin	%	17.5	16.0
Effective tax rate	%	23.4	25.5
Net profit margin	%	12.3	12.1

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GULF OIL LUBRICANTS Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 6 billion as compared to Rs 7 billion in FY20, thereby witnessing an decrease of -18.0%.
• Current assets fell 2% and stood at Rs 12 billion, while fixed assets fell 1% and stood at Rs 3 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 15 billion as against Rs 15 billion during FY20, thereby witnessing a fall of 2%.

GULF OIL LUBRICANTS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	7,500	8,614	14.9
Current Liabilities	Rs m	7,317	6,000	-18.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	15,234	14,940	-1.9
Current assets	Rs m	12,046	11,773	-2.3
Fixed Assets	Rs m	3,188	3,167	-0.6
Total Assets	Rs m	15,234	14,940	-1.9

GULF OIL LUBRICANTS Cash Flow Statement Analysis

• GULF OIL LUBRICANTS's cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs 295 million, an improvement of 69.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -542 million from the Rs 3 billion net cash flows seen during FY20.

GULF OIL LUBRICANTS 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	2,368	1,935	-18.3%
Cash Flow from Investing Activities	Rs m	174	295	69.5%
Cash Flow from Financing Activities	Rs m	49	-2,772	-
Net Cash Flow	Rs m	2,591	-542	-

Current Valuations for GULF OIL LUBRICANTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 39.8, an decline from the EPS of Rs 40.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 726.2, stands at 17.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.1 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 14.8 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	328.1	328.4
TTM Earnings per share	Rs	40.4	39.8
Diluted earnings per share	Rs	41.3	40.8
Price to Cash Flow	x	10.8	14.8
TTM P/E ratio	x	12.6	17.8
Price / Book Value ratio	x	4.5	4.0
Market Cap	Rs m	34,047	34,512
Dividends per share (Unadj.)	Rs	14.0	16.0

Ratio Analysis for GULF OIL LUBRICANTS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.0x during FY21, from 1.6x 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 improved and stood at 19.4x during FY21, from 11.7x 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 declined and down at 23.2% during FY21, from 27.0% 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 32.9% during FY21, from 38.6% 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 14.4% during FY21, from 14.9% 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	1.6	2.0
Debtors’ Days	Days	415	417
Interest coverage	x	11.7	19.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	14.9	14.4
Return on equity	%	27.0	23.2
Return on capital employed	%	38.6	32.9

To see how GULF OIL LUBRICANTS has performed over the last 5 years, please visit here.

GULF OIL LUBRICANTS Share Price Performance

Over the last one year, GULF OIL LUBRICANTS share price has moved up from Rs 520.5 to Rs 726.2, registering a gain of Rs 205.8 or around 39.5%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 14,820.5 (down 0.1%). Over the last one year it has moved up from 10,020.9 to 14,820.5, a gain of 4,800 points (up 47.9%).

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

(To know more, check out historical annual results for GULF OIL LUBRICANTS and quarterly results for GULF OIL LUBRICANTS)

Read: Latest Annual Report Analysis of GULF OIL LUBRICANTS