HINDUSTAN AERO. 2020-21 Annual Report Analysis

Wed, 31 Mar

HINDUSTAN AERO. 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.

HINDUSTAN AERO. Income Statement Analysis

• Operating income during the year rose 6.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 6.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.6% in FY21 as against 23.5% in FY20.
• Depreciation charges increased by 18.0% and finance costs decreased by 25.8% YoY, respectively.
• Other income grew by 20.8% YoY.
• Net profit for the year grew by 12.5% YoY.
• Net profit margins during the year grew from 13.4% in FY20 to 14.2% in FY21.

HINDUSTAN AERO. Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	214,452	227,545	6.1%
Other income	Rs m	2,966	3,582	20.8%
Total Revenues	Rs m	217,417	231,128	6.3%
Gross profit	Rs m	50,332	53,591	6.5%
Depreciation	Rs m	9,985	11,783	18.0%
Interest	Rs m	3,596	2,669	-25.8%
Profit before tax	Rs m	39,716	42,722	7.6%
Tax	Rs m	10,960	10,379	-5.3%
Profit after tax	Rs m	28,756	32,343	12.5%
Gross profit margin	%	23.5	23.6
Effective tax rate	%	27.6	24.3
Net profit margin	%	13.4	14.2

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HINDUSTAN AERO. Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 255 billion as compared to Rs 311 billion in FY20, thereby witnessing an decrease of -18.0%.
• Current assets fell 3% and stood at Rs 402 billion, while fixed assets rose 3% and stood at Rs 117 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 519 billion as against Rs 528 billion during FY20, thereby witnessing a fall of 2%.

HINDUSTAN AERO. Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	132,485	154,123	16.3
Current Liabilities	Rs m	311,272	255,107	-18.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	528,073	518,936	-1.7
Current assets	Rs m	413,938	401,714	-3.0
Fixed Assets	Rs m	114,135	117,222	2.7
Total Assets	Rs m	528,073	518,936	-1.7

HINDUSTAN AERO. Cash Flow Statement Analysis

• HINDUSTAN AERO.'s cash flow from operating activities (CFO) during FY21 stood at Rs 153 billion, an improvement of 899.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -13 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -71 billion on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 69 billion from the Rs 3 billion net cash flows seen during FY20.

HINDUSTAN AERO. 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	15,274	152,627	899.3%
Cash Flow from Investing Activities	Rs m	-13,389	-12,710	-
Cash Flow from Financing Activities	Rs m	639	-71,249	-
Net Cash Flow	Rs m	2,525	68,668	2,620.1%

Current Valuations for HINDUSTAN AERO.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 96.7, an improvement from the EPS of Rs 86.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 994.9, stands at 10.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.2 times, while the price to sales ratio stands at 1.5 times.
• The company's price to cash flow (P/CF) ratio stood at 7.3 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	641.3	680.5
TTM Earnings per share	Rs	86.0	96.7
Diluted earnings per share	Rs	86.0	96.7
Price to Cash Flow	x	4.6	7.3
TTM P/E ratio	x	6.2	10.3
Price / Book Value ratio	x	1.7	2.1
Market Cap	Rs m	224,767	319,934
Dividends per share (Unadj.)	Rs	33.0	30.0

Ratio Analysis for HINDUSTAN AERO.

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY21, from 1.3x 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 17.0x during FY21, from 12.0x 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 21.0% during FY21, from 21.7% 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 29.5% during FY21, from 32.7% 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 6.7% during FY21, from 6.1% 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	1.3	1.6
Debtors’ Days	Days	1,912	904
Interest coverage	x	12.0	17.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.1	6.7
Return on equity	%	21.7	21.0
Return on capital employed	%	32.7	29.5

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

HINDUSTAN AERO. Share Price Performance

Over the last one year, HINDUSTAN AERO. share price has moved up from Rs 533.0 to Rs 994.9, registering a gain of Rs 461.9 or around 86.7%.

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

(To know more, check out historical annual results for HINDUSTAN AERO. and quarterly results for HINDUSTAN AERO.)

Read: Latest Annual Report Analysis of HINDUSTAN AERO.