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HUL 2018-19 Annual Report Analysis
Sun, 31 Mar

HUL has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

HUL Income Statement Analysis

  • Operating income during the year rose 12.8% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 15.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 22.0% in FY19 as against 21.4% in FY18.
  • Depreciation charges increased by 8.7% and finance costs increased by 26.9% YoY, respectively.
  • Other income grew by 43.2% YoY.
  • Net profit for the year grew by 15.9% YoY.
  • Net profit margins during the year grew from 15.0% in FY18 to 15.4% in FY19.

HUL Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 348,570 393,110 12.8%
Other income Rs m 3,840 5,500 43.2%
Total Revenues Rs m 352,410 398,610 13.1%
Gross profit Rs m 74,680 86,520 15.9%
Depreciation Rs m 5,200 5,650 8.7%
Interest Rs m 260 330 26.9%
Profit before tax Rs m 73,060 86,040 17.8%
Tax Rs m 20,790 25,440 22.4%
Profit after tax Rs m 52,270 60,600 15.9%
Gross profit margin % 21.4 22.0
Effective tax rate % 28.5 29.6
Net profit margin % 15.0 15.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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HUL Balance Sheet Analysis

  • The company's current liabilities during FY19 down at Rs 87 billion as compared to Rs 89 billion in FY18, thereby witnessing an decrease of -2.5%.
  • Current assets rose 2% and stood at Rs 119 billion, while fixed assets rose 7% and stood at Rs 63 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 183 billion as against Rs 176 billion during FY18, thereby witnessing a growth of 4%.

HUL Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 72,520 78,430 8.1
 
Current Liabilities Rs m 88,870 86,670 -2.5
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 175,600 182,560 4.0
 
Current assets Rs m 116,440 119,100 2.3
Fixed Assets Rs m 59,160 63,460 7.3
Total Assets Rs m 175,600 182,560 4.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



HUL Cash Flow Statement Analysis

  • HUL's cash flow from operating activities (CFO) during FY19 stood at Rs 58 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -4 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -54 billion on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -280 million from the Rs 210 million net cash flows seen during FY18.

HUL Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 60,590 58,000 -4.3%
Cash Flow from Investing Activities Rs m -10,630 -4,380 -
Cash Flow from Financing Activities Rs m -49,750 -53,900 -
Net Cash Flow Rs m 210 -280 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for HUL

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 28.0, an improvement from the EPS of Rs 24.1 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,707.8, stands at 66.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 51.2 times, while the price to sales ratio stands at 9.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 52.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 161.0 181.6
TTM Earnings per share Rs 24.1 28.0
Diluted earnings per share Rs 22.2 25.8
Price to Cash Flow x 54.6 52.2
TTM P/E ratio x 59.8 66.5
Price / Book Value ratio x 34.5 44.1
Market Cap Rs m 2,504,630 3,454,976
Dividends per share (Unadj.) Rs 20.0 22.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for HUL

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.4x during FY19, from 1.3x during FY18. 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 261.7x during FY19, from 282.0x during FY18. 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 77.3% during FY19, from 72.1% during FY19. 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 110.1% during FY19, from 101.1% during FY18. 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 33.4% during FY19, from 29.9% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.3 1.4
Debtors’ Days Days 1 2
Interest coverage x 282.0 261.7
Debt to equity ratio x 0.0 0.0
Return on assets % 29.9 33.4
Return on equity % 72.1 77.3
Return on capital employed % 101.1 110.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

HUL Share Price Performance

Over the last one year, HUL share price has moved up from Rs 1,335.9 to Rs 1,707.8, registering a gain of Rs 371.9 or around 27.8%.

Meanwhile, the S&P BSE FMCG Index is trading at Rs 11,741.5 (down 0.1%). Over the last one year it has moved up from 10,290.1 to 11,741.5, a gain of 1,451 points (up 14.1%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Annual Report FAQs

What is the current share price of HUL?

HUL currently trades at Rs 2,268.3 per share. You can check out the latest share price performance of HUL here...

What was the revenue of HUL in FY19? How does it compare to earlier years?

The revenues of HUL stood at Rs 398,610 m in FY19, which was up 13.1% compared to Rs 352,410 m reported in FY18.

HUL's revenue has grown from Rs 306,113 m in FY15 to Rs 398,610 m in FY19.

Over the past 5 years, the revenue of HUL has grown at a CAGR of 6.8%.

What was the net profit of HUL in FY19? How does it compare to earlier years?

The net profit of HUL stood at Rs 60,600 m in FY19, which was up 15.9% compared to Rs 52,270 m reported in FY18.

This compares to a net profit of Rs 44,900 m in FY17 and a net profit of Rs 41,600 m in FY16.

Over the past 5 years, HUL net profit has grown at a CAGR of 8.5%.

What does the cash flow statement of HUL reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of HUL reveals:

  • Cash flow from operations decreased in FY19 and stood at Rs 58,000 m as compared to Rs 60,590 m in FY18.
  • Cash flow from investments increased in FY19 and stood at Rs -4,380 m as compared to Rs -10,630 m in FY18.
  • Cash flow from financial activity decreased in FY19 and stood at Rs -53,900 m as compared to Rs -49,750 m in FY18.

Here's the cash flow statement of HUL for the past 5 years.

(Rs m)FY15FY16FY17FY18FY19
From Operations32,91941,71051,85060,59058,000
From Investments1,380-2,820-11,730-10,630-4,380
From Financial Activity-34,624-38,640-42,140-49,750-53,900
Net Cashflow-325250-2,020210-280

What does the Key Ratio analysis of HUL reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of HUL reveals:

  • Operating profit margins witnessed a fall and down at 22.0% in FY19 as against 21.4% in FY18.
  • Net profit margins grew from 15.0% in FY18 to 15.4% in FY19.
  • Debt to Equity ratio for FY19 stood at 0.0 as compared to 0.0 in FY18.

Here's the ratio/financial analysis of HUL for the past 5 years.

 FY15FY16FY17FY18FY19
Operating Profit Margin (%)20.320.021.421.422.0
Net Profit Margin (%)14.613.914.615.015.4
Debt to Equity Ratio (x)0.00.00.00.00.0

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