INDIAN HOTELS 2020-21 Annual Report Analysis

Wed, 31 Mar

INDIAN HOTELS 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.

INDIAN HOTELS Income Statement Analysis

• Operating income during the year fell 64.7% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 120.0% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 12.8% in FY21 as against 22.6% in FY20.
• Depreciation charges increased by 1.3% and finance costs increased by 18.5% YoY, respectively.
• Other income grew by 25.4% YoY.
• Net profit for the year declined by 297.9% YoY.
• Net profit margins during the year declined from 7.9% in FY20 to 44.1% in FY21.

INDIAN HOTELS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	44,631	15,752	-64.7%
Other income	Rs m	1,324	1,661	25.4%
Total Revenues	Rs m	45,956	17,412	-62.1%
Gross profit	Rs m	10,085	-2,018	-120.0%
Depreciation	Rs m	4,042	4,096	1.3%
Interest	Rs m	3,411	4,042	18.5%
Profit before tax	Rs m	3,955	-8,495	-314.8%
Tax	Rs m	448	-1,553	-447.0%
Profit after tax	Rs m	3,508	-6,942	-297.9%
Gross profit margin	%	22.6	-12.8
Effective tax rate	%	11.3	18.3
Net profit margin	%	7.9	-44.1

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INDIAN HOTELS Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 29 billion as compared to Rs 19 billion in FY20, thereby witnessing an increase of 55.1%.
• Long-term debt stood at Rs 22 billion as compared to Rs 21 billion during FY20, a growth of 4.6%.
• Current assets fell 20% and stood at Rs 12 billion, while fixed assets rose 2% and stood at Rs 102 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 114 billion as against Rs 114 billion during FY20, thereby witnessing a fall of 0%.

INDIAN HOTELS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	43,568	36,484	-16.3
Current Liabilities	Rs m	19,008	29,481	55.1
Long-term Debt	Rs m	21,258	22,238	4.6
Total Liabilities	Rs m	114,418	113,947	-0.4
Current assets	Rs m	14,373	11,539	-19.7
Fixed Assets	Rs m	100,045	102,409	2.4
Total Assets	Rs m	114,418	113,947	-0.4

INDIAN HOTELS Cash Flow Statement Analysis

• INDIAN HOTELS's cash flow from operating activities (CFO) during FY21 stood at Rs -3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 3 billion, an improvement of 206% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -2 billion from the Rs 615 million net cash flows seen during FY20.

INDIAN HOTELS 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	8,235	-3,187	-
Cash Flow from Investing Activities	Rs m	-5,019	-1,197	-
Cash Flow from Financing Activities	Rs m	-2,654	2,804	-
Net Cash Flow	Rs m	615	-1,566	-

Current Valuations for INDIAN HOTELS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -5.8, an decline from the EPS of Rs 2.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 110.9, stands at -22.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.3 times, while the price to sales ratio stands at 8.4 times.
• The company's price to cash flow (P/CF) ratio stood at -42.0 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	37.5	13.2
TTM Earnings per share	Rs	2.9	-5.8
Diluted earnings per share	Rs	2.5	-4.9
Price to Cash Flow	x	14.1	-42.0
TTM P/E ratio	x	30.3	-22.7
Price / Book Value ratio	x	3.2	3.3
Market Cap	Rs m	140,332	119,580
Dividends per share (Unadj.)	Rs	0.5	0.4

Ratio Analysis for INDIAN HOTELS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.4x during FY21, from 0.8x 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 -1.1x during FY21, from 2.2x 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 -19.0% during FY21, from 8.1% 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 -7.6% during FY21, from 11.4% 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 -2.5% during FY21, from 6.0% 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	0.8	0.4
Debtors’ Days	Days	2	5
Interest coverage	x	2.2	-1.1
Debt to equity ratio	x	0.5	0.6
Return on assets	%	6.0	-2.5
Return on equity	%	8.1	-19.0
Return on capital employed	%	11.4	-7.6

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

INDIAN HOTELS Share Price Performance

Over the last one year, INDIAN HOTELS share price has moved up from Rs 74.9 to Rs 110.9, registering a gain of Rs 36.0 or around 48.1%.

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

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

Read: Latest Annual Report Analysis of INDIAN HOTELS