INGERSOLL RAND 2022-23 Annual Report Analysis

Wed, 19 Jul

INGERSOLL RAND 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.

INGERSOLL RAND Income Statement Analysis

• Operating income during the year rose 26.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 62.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.3% in FY23 as against 16.6% in FY22.
• Depreciation charges increased by 15.8% and finance costs decreased by 5.7% YoY, respectively.
• Other income grew by 36.3% YoY.
• Net profit for the year grew by 65.8% YoY.
• Net profit margins during the year grew from 12.1% in FY22 to 15.9% in FY23.

INGERSOLL RAND Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	9,099	11,508	26.5%
Other income	Rs m	142	194	36.3%
Total Revenues	Rs m	9,242	11,702	26.6%
Gross profit	Rs m	1,508	2,456	62.9%
Depreciation	Rs m	141	163	15.8%
Interest	Rs m	26	24	-5.7%
Profit before tax	Rs m	1,484	2,463	66.0%
Tax	Rs m	382	637	66.6%
Profit after tax	Rs m	1,101	1,826	65.8%
Gross profit margin	%	16.6	21.3
Effective tax rate	%	25.8	25.8
Net profit margin	%	12.1	15.9

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INGERSOLL RAND Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 3 billion as compared to Rs 3 billion in FY22, thereby witnessing an decrease of -0.2%.
• Current assets rose 4% and stood at Rs 7 billion, while fixed assets fell 4% and stood at Rs 1 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 9 billion as against Rs 8 billion during FY22, thereby witnessing a growth of 3%.

INGERSOLL RAND Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	5,519	5,780	4.7
Current Liabilities	Rs m	2,766	2,761	-0.2
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	8,354	8,579	2.7
Current assets	Rs m	6,943	7,220	4.0
Fixed Assets	Rs m	1,411	1,359	-3.7
Total Assets	Rs m	8,354	8,579	2.7

INGERSOLL RAND Cash Flow Statement Analysis

• INGERSOLL RAND's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 83.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -46 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -187 million from the Rs 625 million net cash flows seen during FY22.

INGERSOLL RAND 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	809	1,481	83.0%
Cash Flow from Investing Activities	Rs m	-53	-46	-
Cash Flow from Financing Activities	Rs m	-130	-1,617	-
Net Cash Flow	Rs m	625	-187	-

Current Valuations for INGERSOLL RAND

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 57.9, an improvement from the EPS of Rs 34.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,869.0, stands at 49.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 15.7 times, while the price to sales ratio stands at 7.9 times.
• The company's price to cash flow (P/CF) ratio stood at 31.4 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	288.2	364.5
TTM Earnings per share	Rs	34.9	57.9
Diluted earnings per share	Rs	34.9	57.9
Price to Cash Flow	x	40.6	31.4
TTM P/E ratio	x	45.8	49.6
Price / Book Value ratio	x	6.9	10.8
Market Cap	Rs m	38,240	62,458
Dividends per share (Unadj.)	Rs	20.0	50.0

Ratio Analysis for INGERSOLL RAND

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.6x during FY23, from 2.5x 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 103.3x during FY23, from 59.1x 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 improved and stood at 31.6% during FY23, from 20.0% 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 43.0% during FY23, from 27.3% 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 21.6% during FY23, from 13.5% 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	2.5	2.6
Debtors’ Days	Days	880	850
Interest coverage	x	59.1	103.3
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.5	21.6
Return on equity	%	20.0	31.6
Return on capital employed	%	27.3	43.0

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

INGERSOLL RAND Share Price Performance

Over the last one year, INGERSOLL RAND share price has moved up from Rs 1,642.2 to Rs 2,869.0, registering a gain of Rs 1,226.9 or around 74.7%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 41,819.7 (up 0.5%). Over the last one year it has moved up from 28,302.0 to 41,819.7, a gain of 13,518 points (up 47.8%).

Overall, the S&P BSE SENSEX is up 23.1% over the year.

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