IOC 2020-21 Annual Report Analysis

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IOC 2020-21 Annual Report Analysis
Wed, 20 Oct

IOC 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.

IOC Income Statement Analysis

  • Operating income during the year fell 44.5% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 627.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.3% in FY21 as against 1.4% in FY20.
  • Depreciation charges increased by 6.5% and finance costs decreased by 33.3% YoY, respectively.
  • Other income grew by 55.1% YoY.
  • Net profit for the year declined by 734.3% YoY.
  • Net profit margins during the year grew from 0.8% in FY20 to 9.1% in FY21.

IOC Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 3,991,319 2,213,757 -44.5%
Other income Rs m 27,736 43,030 55.1%
Total Revenues Rs m 4,019,055 2,256,787 -43.8%
Gross profit Rs m 55,864 406,176 627.1%
Depreciation Rs m 102,734 109,415 6.5%
Interest Rs m 66,297 44,252 -33.3%
Profit before tax Rs m -85,431 295,540 -445.9%
Tax Rs m -53,007 89,885 -269.6%
Profit after tax Rs m -32,424 205,655 -734.3%
Gross profit margin % 1.4 18.3
Effective tax rate % 62.0 30.4
Net profit margin % -0.8 9.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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IOC Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 1,669 billion as compared to Rs 1,615 billion in FY20, thereby witnessing an increase of 3.3%.
  • Long-term debt stood at Rs 609 billion as compared to Rs 561 billion during FY20, a growth of 8.7%.
  • Current assets rose 9% and stood at Rs 1,209 billion, while fixed assets rose 8% and stood at Rs 2,576 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 3,785 billion as against Rs 3,494 billion during FY20, thereby witnessing a growth of 8%.

IOC Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 953,979 1,118,381 17.2
 
Current Liabilities Rs m 1,615,285 1,668,782 3.3
Long-term Debt Rs m 560,706 609,349 8.7
Total Liabilities Rs m 3,493,753 3,784,802 8.3
 
Current assets Rs m 1,107,459 1,209,120 9.2
Fixed Assets Rs m 2,386,294 2,575,682 7.9
Total Assets Rs m 3,493,753 3,784,802 8.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



IOC Cash Flow Statement Analysis

  • IOC's cash flow from operating activities (CFO) during FY21 stood at Rs 499 billion, an improvement of 597.7% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -242 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -263 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -7 billion from the Rs 5 billion net cash flows seen during FY20.

IOC 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 71,463 498,617 597.7%
Cash Flow from Investing Activities Rs m -291,008 -242,449 -
Cash Flow from Financing Activities Rs m 224,560 -262,702 -
Net Cash Flow Rs m 5,015 -6,534 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for IOC

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 21.8, an improvement from the EPS of Rs -3.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 130.8, stands at 5.1 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 0.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 3.9 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 424.0 235.2
TTM Earnings per share Rs -3.4 21.8
Diluted earnings per share Rs -3.4 21.8
Price to Cash Flow x 17.5 3.9
TTM P/E ratio x 5.1 5.1
Price / Book Value ratio x 1.2 0.7
Market Cap Rs m 1,231,372 1,231,372
Dividends per share (Unadj.) Rs 4.3 12.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for IOC

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 0.7x during FY21, from 0.7x 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 improved and stood at 7.7x during FY21, from -0.3x 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 improved and stood at 18.4% during FY21, from -3.4% 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 improved and stood at 19.7% during FY21, from -1.3% 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 improved and stood at 6.6% during FY21, from 1.0% 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 0.7 0.7
Debtors’ Days Days 1 2
Interest coverage x -0.3 7.7
Debt to equity ratio x 0.6 0.5
Return on assets % 1.0 6.6
Return on equity % -3.4 18.4
Return on capital employed % -1.3 19.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

IOC Share Price Performance

Over the last one year, IOC share price has moved up from Rs 75.1 to Rs 130.8, registering a gain of Rs 55.8 or around 74.3%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 18,749.0 (down 1.8%). Over the last one year it has moved up from 11,965.2 to 18,749.0, a gain of 6,784 points (up 56.7%).

Overall, the S&P BSE SENSEX is up 51.5% over the year.

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

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Related Views on News

IOC Announces Quarterly Results (1QFY22); Net Profit Up 172.1% (Quarterly Result Update)

Aug 3, 2021 | Updated on Aug 3, 2021

For the quarter ended June 2021, IOC has posted a net profit of Rs 58 bn (up 172.1% YoY). Sales on the other hand came in at Rs 1,565 bn (up 73.7% YoY). Read on for a complete analysis of IOC's quarterly results.

IOC Announces Quarterly Results (3QFY21); Net Profit Up 54.5% (Quarterly Result Update)

Feb 1, 2021 | Updated on Feb 1, 2021

For the quarter ended December 2020, IOC has posted a net profit of Rs 38 bn (up 54.5% YoY). Sales on the other hand came in at Rs 1,478 bn (up 0.6% YoY). Read on for a complete analysis of IOC's quarterly results.

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