GRASIM IND. 2017-18 Annual Report Analysis

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GRASIM IND. 2017-18 Annual Report Analysis
Wed, 19 Dec

GRASIM IND. 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.

GRASIM IND. Income Statement Analysis

  • Operating income during the year rose 56.2% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 33.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.6% in FY18 as against 20.5% in FY17.
  • Depreciation charges increased by 50.7% and finance costs increased by 93.5% YoY, respectively.
  • Other income grew by 4.5% YoY.
  • Net profit for the year declined by 13.1% YoY.
  • Net profit margins during the year declined from 11.5% in FY17 to 6.4% in FY18.

GRASIM IND. Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 360,684 563,527 56.2%
Other income Rs m 9,478 9,902 4.5%
Total Revenues Rs m 370,162 573,429 54.9%
Gross profit Rs m 73,851 98,909 33.9%
Depreciation Rs m 18,076 27,244 50.7%
Interest Rs m 7,024 13,591 93.5%
Profit before tax Rs m 58,229 67,976 16.7%
Tax Rs m 17,067 19,471 14.1%
Profit after tax Rs m 42,456 36,902 -13.1%
Gross profit margin % 20.5 17.6
Effective tax rate % 29.3 28.6
Net profit margin % 11.5 6.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



GRASIM IND. Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 423 billion as compared to Rs 110 billion in FY17, thereby witnessing an increase of 284.6%.
  • Long-term debt stood at Rs 408 billion as compared to Rs 68 billion during FY17, a growth of 502.7%.
  • Current assets rose 118% and stood at Rs 402 billion, while fixed assets rose 46% and stood at Rs 477 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 2,079 billion as against Rs 628 billion during FY17, thereby witnessing a growth of 231%.

GRASIM IND. Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 313,868 573,619 82.8
 
Current Liabilities Rs m 109,951 422,919 284.6
Long-term Debt Rs m 67,687 407,934 502.7
Total Liabilities Rs m 627,676 2,078,672 231.2
 
Current assets Rs m 184,595 402,489 118.0
Fixed Assets Rs m 327,168 476,909 45.8
Total Assets Rs m 627,676 2,078,672 231.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



GRASIM IND. Cash Flow Statement Analysis

  • GRASIM IND.'s cash flow from operating activities (CFO) during FY18 stood at Rs -34 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -2 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs 35 billion, an improvement of 191% on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 9 billion from the Rs -195 million net cash flows seen during FY17.

GRASIM IND. 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 72,878 -33,932 -
Cash Flow from Investing Activities Rs m -34,877 -2,415 -
Cash Flow from Financing Activities Rs m -37,986 34,540 -
Net Cash Flow Rs m -195 8,558 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for GRASIM IND.

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 56.1, an decline from the EPS of Rs 90.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 866.0, stands at 18.2 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.3 times, while the price to sales ratio stands at 1.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 5.7 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 772.6 857.2
TTM Earnings per share Rs 90.9 56.1
Diluted earnings per share Rs 91.0 79.1
Price to Cash Flow x 6.8 5.7
TTM P/E ratio x 18.2 18.2
Price / Book Value ratio x 1.4 1.3
Market Cap Rs m 404,283 404,231
Dividends per share (Unadj.) Rs 5.5 6.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for GRASIM IND.

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.0x during FY18, from 1.7x 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 deteriorated and stood at 6.0x during FY18, from 9.3x 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 declined and down at 6.4% during FY18, from 13.5% 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 declined and down at 7.1% during FY18, from 17.4% 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 declined and down at 2.4% during FY18, from 7.9% 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 1.7 1.0
Debtors’ Days Days 30 34
Interest coverage x 9.3 6.0
Debt to equity ratio x 0.2 0.7
Return on assets % 7.9 2.4
Return on equity % 13.5 6.4
Return on capital employed % 17.4 7.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

GRASIM IND. Share Price Performance

Over the last one year, GRASIM IND. share price has moved up from Rs 1,135.0 to Rs 866.0, registering a loss of Rs 269.0 or around 23.7%.

Overall, the S&P BSE SENSEX is up 8.6% over the year.

(To know more, check out historical annual results for GRASIM IND. and quarterly results for GRASIM IND.)

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