CYIENT 2019-20 Annual Report Analysis

Fri, 1 Jan

CYIENT has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

CYIENT Income Statement Analysis

• Operating income during the year fell 4.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 13.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 12.4% in FY20 as against 13.7% in FY19.
• Depreciation charges increased by 68.6% and finance costs increased by 49.1% YoY, respectively.
• Other income grew by 18.1% YoY.
• Net profit for the year declined by 28.5% YoY.
• Net profit margins during the year declined from 10.0% in FY19 to 7.4% in FY20.

CYIENT Income Statement 2019-20

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Net Sales	Rs m	46,175	44,274	-4.1%
Other income	Rs m	1,340	1,583	18.1%
Total Revenues	Rs m	47,515	45,857	-3.5%
Gross profit	Rs m	6,328	5,489	-13.3%
Depreciation	Rs m	1,114	1,878	68.6%
Interest	Rs m	326	486	49.1%
Profit before tax	Rs m	6,228	4,708	-24.4%
Tax	Rs m	1,427	1,270	-11.0%
Profit after tax	Rs m	4,771	3,412	-28.5%
Gross profit margin	%	13.7	12.4
Effective tax rate	%	22.9	27.0
Net profit margin	%	10.0	7.4

DISCOVER: How to Potentially Multiply Your Returns by Upto 5x...

CYIENT Balance Sheet Analysis

• The company's current liabilities during FY20 stood at Rs 11 billion as compared to Rs 10 billion in FY19, thereby witnessing an increase of 12.5%.
• Long-term debt down at Rs 859 million as compared to Rs 1 billion during FY19, a fall of 23.0%.
• Current assets fell 5% and stood at Rs 25 billion, while fixed assets rose 34% and stood at Rs 15 billion in FY20.
• Overall, the total assets and liabilities for FY20 stood at Rs 42 billion as against Rs 39 billion during FY19, thereby witnessing a growth of 7%.

CYIENT Balance Sheet as on March 2020

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Networth	Rs m	25,641	25,609	-0.1
Current Liabilities	Rs m	9,895	11,135	12.5
Long-term Debt	Rs m	1,116	859	-23.0
Total Liabilities	Rs m	38,892	41,797	7.5
Current assets	Rs m	25,853	24,650	-4.7
Fixed Assets	Rs m	10,820	14,509	34.1
Total Assets	Rs m	38,892	41,797	7.5

CYIENT Cash Flow Statement Analysis

• CYIENT's cash flow from operating activities (CFO) during FY20 stood at Rs 6 billion, an improvement of 57.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY20 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY20 stood at Rs -4 billion on a YoY basis.
• Overall, net cash flows for the company during FY20 stood at Rs -101 million from the Rs -521 million net cash flows seen during FY19.

CYIENT Cash Flow Statement 2019-20

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-19	Mar-20
Cash Flow from Operating Activities	Rs m	3,701	5,824	57.4%
Cash Flow from Investing Activities	Rs m	-2,197	-1,570	-
Cash Flow from Financing Activities	Rs m	-2,321	-4,463	-
Net Cash Flow	Rs m	-521	-101	-

Current Valuations for CYIENT

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 31.0, an decline from the EPS of Rs 43.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 511.7, stands at 17.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 10.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Sales per share (Unadj.)	Rs	418.0	402.6
TTM Earnings per share	Rs	43.2	31.0
Diluted earnings per share	Rs	42.5	30.4
Price to Cash Flow	x	9.6	10.8
TTM P/E ratio	x	17.1	17.3
Price / Book Value ratio	x	3.1	1.9
Market Cap	Rs m	56,522	57,489
Dividends per share (Unadj.)	Rs	15.0	15.0

Ratio Analysis for CYIENT

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.2x during FY20, from 2.6x during FY19. 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 10.7x during FY20, from 20.1x during FY19. 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 13.3% during FY20, from 18.6% during FY20. 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 19.5% during FY20, from 24.4% during FY19. 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 9.3% during FY20, from 13.1% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Current ratio	x	2.6	2.2
Debtors’ Days	Days	64	60
Interest coverage	x	20.1	10.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.1	9.3
Return on equity	%	18.6	13.3
Return on capital employed	%	24.4	19.5

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

CYIENT Share Price Performance

Over the last one year, CYIENT share price has moved up from Rs 433.1 to Rs 511.7, registering a gain of Rs 78.6 or around 18.2%.

Meanwhile, the S&P BSE IT Index is trading at Rs 24,460.7 (up 0.9%). Over the last one year it has moved up from 15,569.6 to 24,460.7, a gain of 8,891 points (up 57.1%).

Overall, the S&P BSE SENSEX is up 15.3% over the year.

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