THE INDIAN HOTELS 2018-19 Annual Report Analysis

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THE INDIAN HOTELS 2018-19 Annual Report Analysis
Wed, 5 Jun

THE INDIAN HOTELS 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.

THE INDIAN HOTELS Income Statement Analysis

  • Operating income during the year rose 10.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 23.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.4% in FY19 as against 16.3% in FY18.
  • Depreciation charges increased by 8.8% and finance costs decreased by 29.3% YoY, respectively.
  • Other income grew by 35.1% YoY.
  • Net profit for the year grew by 186.1% YoY.
  • Net profit margins during the year grew from 2.5% in FY18 to 6.4% in FY19.

THE INDIAN HOTELS Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 41,036 45,120 10.0%
Other income Rs m 617 834 35.1%
Total Revenues Rs m 41,653 45,954 10.3%
Gross profit Rs m 6,704 8,297 23.8%
Depreciation Rs m 3,012 3,279 8.8%
Interest Rs m 2,690 1,901 -29.3%
Profit before tax Rs m 1,618 3,951 144.1%
Tax Rs m 1,211 1,571 29.8%
Profit after tax Rs m 1,035 2,961 186.1%
Gross profit margin % 16.3 18.4
Effective tax rate % 74.8 39.8
Net profit margin % 2.5 6.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



THE INDIAN HOTELS Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 21 billion as compared to Rs 14 billion in FY18, thereby witnessing an increase of 49.9%.
  • Long-term debt down at Rs 17 billion as compared to Rs 23 billion during FY18, a fall of 27.5%.
  • Current assets fell 5% and stood at Rs 12 billion, while fixed assets rose 3% and stood at Rs 65 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 96 billion as against Rs 94 billion during FY18, thereby witnessing a growth of 2%.

THE INDIAN HOTELS Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 41,811 43,480 4.0
 
Current Liabilities Rs m 13,934 20,895 49.9
Long-term Debt Rs m 23,292 16,875 -27.5
Total Liabilities Rs m 93,745 95,838 2.2
 
Current assets Rs m 12,195 11,588 -5.0
Fixed Assets Rs m 63,596 65,384 2.8
Total Assets Rs m 93,745 95,838 2.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



THE INDIAN HOTELS Cash Flow Statement Analysis

  • THE INDIAN HOTELS's cash flow from operating activities (CFO) during FY19 stood at Rs 7 billion, an improvement of 44.6% 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 -3 billion on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -186 million from the Rs 665 million net cash flows seen during FY18.

THE INDIAN HOTELS 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 4,921 7,114 44.6%
Cash Flow from Investing Activities Rs m -5,287 -3,882 -
Cash Flow from Financing Activities Rs m 957 -3,433 -
Net Cash Flow Rs m 665 -186 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for THE INDIAN HOTELS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.5, an improvement from the EPS of Rs 0.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 152.6, stands at 50.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.6 times, while the price to sales ratio stands at 3.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 21.5 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 34.5 37.9
TTM Earnings per share Rs 0.9 2.5
Diluted earnings per share Rs 1.3 3.7
Price to Cash Flow x 49.8 21.5
TTM P/E ratio x 74.2 50.4
Price / Book Value ratio x 3.7 3.6
Market Cap Rs m 181,422 123,180
Dividends per share (Unadj.) Rs 0.4 0.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for THE INDIAN HOTELS

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 0.6x during FY19, from 0.9x 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 improved and stood at 3.1x during FY19, from 1.6x 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 6.8% during FY19, from 2.5% 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 10.7% during FY19, from 7.6% 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 5.1% during FY19, from 4.0% 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 0.9 0.6
Debtors’ Days Days 29 26
Interest coverage x 1.6 3.1
Debt to equity ratio x 0.6 0.4
Return on assets % 4.0 5.1
Return on equity % 2.5 6.8
Return on capital employed % 7.6 10.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

THE INDIAN HOTELS Share Price Performance

Over the last one year, THE INDIAN HOTELS share price has moved up from Rs 132.5 to Rs 152.6, registering a gain of Rs 20.1 or around 15.1%.

Overall, the S&P BSE SENSEX is up 14.5% over the year.

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

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