VODAFONE IDEA 2022-23 Annual Report Analysis

Tue, 27 Jun

VODAFONE IDEA has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

VODAFONE IDEA Income Statement Analysis

• Operating income during the year rose 9.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 3.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 39.7% in FY23 as against 42.0% in FY22.
• Depreciation charges decreased by 2.3% and finance costs increased by 11.2% YoY, respectively.
• Other income grew by 109.8% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year grew from 73.3% in FY22 to 69.5% in FY23.

VODAFONE IDEA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	385,155	421,772	9.5%
Other income	Rs m	1,833	3,846	109.8%
Total Revenues	Rs m	386,988	425,618	10.0%
Gross profit	Rs m	161,816	167,309	3.4%
Depreciation	Rs m	235,843	230,497	-2.3%
Interest	Rs m	210,147	233,634	11.2%
Profit before tax	Rs m	-282,341	-292,976	NA
Tax	Rs m	113	35	-69.0%
Profit after tax	Rs m	-282,454	-293,011	NA
Gross profit margin	%	42.0	39.7
Effective tax rate	%	0.0	0.0
Net profit margin	%	-73.3	-69.5

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VODAFONE IDEA Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 600 billion as compared to Rs 611 billion in FY22, thereby witnessing an decrease of -1.8%.
• Long-term debt stood at Rs 1,893 billion as compared to Rs 1,760 billion during FY22, a growth of 7.6%.
• Current assets fell 18% and stood at Rs 139 billion, while fixed assets rose 9% and stood at Rs 1,933 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 2,072 billion as against Rs 1,940 billion during FY22, thereby witnessing a growth of 7%.

VODAFONE IDEA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	-619,698	-743,629	NA
Current Liabilities	Rs m	611,371	600,344	-1.8
Long-term Debt	Rs m	1,759,508	1,892,901	7.6
Total Liabilities	Rs m	1,940,263	2,072,409	6.8
Current assets	Rs m	168,387	138,653	-17.7
Fixed Assets	Rs m	1,771,876	1,933,263	9.1
Total Assets	Rs m	1,940,263	2,072,409	6.8

VODAFONE IDEA Cash Flow Statement Analysis

• VODAFONE IDEA's cash flow from operating activities (CFO) during FY23 stood at Rs 189 billion, an improvement of 8.5% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -54 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -147 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -12 billion from the Rs 11 billion net cash flows seen during FY22.

VODAFONE IDEA Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	173,870	188,687	8.5%
Cash Flow from Investing Activities	Rs m	-57,303	-54,136	-
Cash Flow from Financing Activities	Rs m	-105,538	-146,795	-
Net Cash Flow	Rs m	11,029	-12,244	-

Current Valuations for VODAFONE IDEA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -6.0, an improvement from the EPS of Rs -8.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 7.6, stands at -1.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at -0.5 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at -6.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	12.0	8.7
TTM Earnings per share	Rs	-8.8	-6.0
Diluted earnings per share	Rs	-5.8	-6.0
Price to Cash Flow	x	-10.1	-6.7
TTM P/E ratio	x	-1.7	-1.3
Price / Book Value ratio	x	-0.6	-0.6
Market Cap	Rs m	342,708	419,862
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for VODAFONE IDEA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.2x during FY23, from 0.3x during FY22. 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 -0.3x during FY23, from -0.3x during FY22. 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 39.4% during FY23, from 45.6% during FY23. 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 -5.2% during FY23, from -6.3% during FY22. 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 -2.9% during FY23, from -3.7% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	0.3	0.2
Debtors’ Days	Days	23	19
Interest coverage	x	-0.3	-0.3
Debt to equity ratio	x	-2.8	-2.5
Return on assets	%	-3.7	-2.9
Return on equity	%	45.6	39.4
Return on capital employed	%	-6.3	-5.2

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

VODAFONE IDEA Share Price Performance

Over the last one year, VODAFONE IDEA share price has moved down from Rs 8.9 to Rs 7.6, registering a loss of Rs 1.3 or around 14.1%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 13,018.5 (up 0.2%). Over the last one year it has moved down from 13,116.7 to 13,018.5, a loss of 98 points (down 0.7%).

Overall, the S&P BSE SENSEX is up 20.8% over the year.

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