HIKAL. 2021-22 Annual Report Analysis

Mon, 5 Sep

HIKAL. has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

HIKAL. Income Statement Analysis

• Operating income during the year rose 12.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 5.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.5% in FY22 as against 18.8% in FY21.
• Depreciation charges increased by 12.2% and finance costs decreased by 13.8% YoY, respectively.
• Other income declined by 1.8% YoY.
• Net profit for the year grew by 20.5% YoY.
• Net profit margins during the year grew from 7.7% in FY21 to 8.3% in FY22.

HIKAL. Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	17,204	19,427	12.9%
Other income	Rs m	50	49	-1.8%
Total Revenues	Rs m	17,254	19,476	12.9%
Gross profit	Rs m	3,229	3,406	5.5%
Depreciation	Rs m	852	957	12.2%
Interest	Rs m	362	312	-13.8%
Profit before tax	Rs m	2,064	2,186	5.9%
Tax	Rs m	733	581	-20.8%
Profit after tax	Rs m	1,331	1,605	20.5%
Gross profit margin	%	18.8	17.5
Effective tax rate	%	35.5	26.6
Net profit margin	%	7.7	8.3

HIKAL. Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 8 billion as compared to Rs 7 billion in FY21, thereby witnessing an increase of 17.8%.
• Long-term debt stood at Rs 3 billion as compared to Rs 3 billion during FY21, a growth of 9.1%.
• Current assets rose 11% and stood at Rs 10 billion, while fixed assets rose 20% and stood at Rs 13 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 23 billion as against Rs 20 billion during FY21, thereby witnessing a growth of 15%.

HIKAL. Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	9,334	10,680	14.4
Current Liabilities	Rs m	7,033	8,281	17.8
Long-term Debt	Rs m	2,629	2,867	9.1
Total Liabilities	Rs m	20,157	23,280	15.5
Current assets	Rs m	9,251	10,232	10.6
Fixed Assets	Rs m	10,906	13,048	19.6
Total Assets	Rs m	20,157	23,280	15.5

HIKAL. Cash Flow Statement Analysis

• HIKAL.'s cash flow from operating activities (CFO) during FY22 stood at Rs 3 billion, an improvement of 28.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -3 billion, an improvement of 82.1% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -56 million, an improvement of 94% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 38 million from the Rs -240 million net cash flows seen during FY21.

HIKAL. Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	2,290	2,937	28.3%
Cash Flow from Investing Activities	Rs m	-1,562	-2,844	-
Cash Flow from Financing Activities	Rs m	-969	-56	-
Net Cash Flow	Rs m	-240	38	-

Current Valuations for HIKAL.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.0, an improvement from the EPS of Rs 10.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 332.8, stands at 40.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.8 times, while the price to sales ratio stands at 2.1 times.
• The company's price to cash flow (P/CF) ratio stood at 21.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	139.5	157.6
TTM Earnings per share	Rs	10.8	13.0
Diluted earnings per share	Rs	10.8	13.0
Price to Cash Flow	x	8.1	21.3
TTM P/E ratio	x	13.3	40.6
Price / Book Value ratio	x	1.8	5.1
Market Cap	Rs m	16,738	54,672
Dividends per share (Unadj.)	Rs	2.0	1.6

Ratio Analysis for HIKAL.

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x during FY22, from 1.3x during FY21. 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 8.0x during FY22, from 6.7x during FY21. 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 15.0% during FY22, from 14.3% during FY22. 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 18.4% during FY22, from 20.3% during FY21. 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 8.2% during FY22, from 8.4% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.3	1.2
Debtors’ Days	Days	103	82
Interest coverage	x	6.7	8.0
Debt to equity ratio	x	0.3	0.3
Return on assets	%	8.4	8.2
Return on equity	%	14.3	15.0
Return on capital employed	%	20.3	18.4

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

HIKAL. Share Price Performance

Over the last one year, HIKAL. share price has moved down from Rs 627.5 to Rs 332.8, registering a loss of Rs 294.8 or around 47.0%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 22,784.8 (up 0.2%). Over the last one year it has moved down from 26,754.8 to 22,784.8, a loss of 3,970 points (down 14.8%).

Overall, the S&P BSE SENSEX is up 3.4% over the year.

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

Read: Latest Annual Report Analysis of HIKAL.