HPL ELECTRIC & POWER 2020-21 Annual Report Analysis

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HPL ELECTRIC & POWER 2020-21 Annual Report Analysis
Mon, 8 Nov

HPL ELECTRIC & POWER 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.

HPL ELECTRIC & POWER Income Statement Analysis

  • Operating income during the year fell 10.4% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 4.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.6% in FY21 as against 12.8% in FY20.
  • Depreciation charges increased by 20.1% and finance costs increased by 4.8% YoY, respectively.
  • Other income declined by 11.2% YoY.
  • Net profit for the year declined by 54.3% YoY.
  • Net profit margins during the year declined from 2.2% in FY20 to 1.1% in FY21.

HPL ELECTRIC & POWER Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 9,765 8,751 -10.4%
Other income Rs m 46 41 -11.2%
Total Revenues Rs m 9,811 8,792 -10.4%
Gross profit Rs m 1,249 1,190 -4.7%
Depreciation Rs m 374 449 20.1%
Interest Rs m 614 644 4.8%
Profit before tax Rs m 306 137 -55.2%
Tax Rs m 87 37 -57.5%
Profit after tax Rs m 219 100 -54.3%
Gross profit margin % 12.8 13.6
Effective tax rate % 28.4 27.0
Net profit margin % 2.2 1.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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HPL ELECTRIC & POWER Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 8 billion as compared to Rs 7 billion in FY20, thereby witnessing an increase of 2.4%.
  • Long-term debt down at Rs 440 million as compared to Rs 511 million during FY20, a fall of 14.0%.
  • Current assets rose 6% and stood at Rs 11 billion, while fixed assets fell 7% and stood at Rs 5 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 16 billion as against Rs 15 billion during FY20, thereby witnessing a growth of 1%.

HPL ELECTRIC & POWER Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 7,487 7,583 1.3
 
Current Liabilities Rs m 7,423 7,599 2.4
Long-term Debt Rs m 511 440 -14.0
Total Liabilities Rs m 15,353 15,576 1.5
 
Current assets Rs m 10,214 10,794 5.7
Fixed Assets Rs m 5,139 4,783 -6.9
Total Assets Rs m 15,353 15,576 1.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



HPL ELECTRIC & POWER Cash Flow Statement Analysis

  • HPL ELECTRIC & POWER's cash flow from operating activities (CFO) during FY21 stood at Rs 846 million, an improvement of 35.3% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -81 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -706 million on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 58 million from the Rs -3 million net cash flows seen during FY20.

HPL ELECTRIC & POWER 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 625 846 35.3%
Cash Flow from Investing Activities Rs m -599 -81 -
Cash Flow from Financing Activities Rs m -29 -706 -
Net Cash Flow Rs m -3 58 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for HPL ELECTRIC & POWER

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 1.6, an decline from the EPS of Rs 3.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 69.2, stands at 46.2 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.4 times, while the price to sales ratio stands at 0.3 times.
  • The company's price to cash flow (P/CF) ratio stood at 8.1 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 151.9 136.1
TTM Earnings per share Rs 3.4 1.6
Diluted earnings per share Rs 3.4 1.6
Price to Cash Flow x 7.5 8.1
TTM P/E ratio x 46.2 46.2
Price / Book Value ratio x 0.4 0.4
Market Cap Rs m 4,446 4,446
Dividends per share (Unadj.) Rs 0.2 0.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for HPL ELECTRIC & POWER

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.4x during FY21, from 1.4x 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 deteriorated and stood at 1.2x during FY21, from 1.5x 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 1.3% during FY21, from 2.9% 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 9.7% during FY21, from 11.5% 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 4.8% during FY21, from 5.4% 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 1.4 1.4
Debtors’ Days Days 1,731 2,139
Interest coverage x 1.5 1.2
Debt to equity ratio x 0.1 0.1
Return on assets % 5.4 4.8
Return on equity % 2.9 1.3
Return on capital employed % 11.5 9.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how HPL ELECTRIC & POWER has performed over the last 5 years, please visit here.

HPL ELECTRIC & POWER Share Price Performance

Over the last one year, HPL ELECTRIC & POWER share price has moved up from Rs 28.9 to Rs 69.2, registering a gain of Rs 40.3 or around 139.7%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 28,527.5 (up 1.5%). Over the last one year it has moved up from 14,807.1 to 28,527.5, a gain of 13,720 points (up 92.7%).

Overall, the S&P BSE SENSEX is up 49.1% over the year.

(To know more, check out historical annual results for HPL ELECTRIC & POWER and quarterly results for HPL ELECTRIC & POWER)

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