IRB INFRA 2017-18 Annual Report Analysis

Sat, 31 Mar

IRB INFRA has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

IRB INFRA Income Statement Analysis

• Operating income during the year fell 2.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 7.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 49.4% in FY18 as against 52.3% in FY17.
• Depreciation charges decreased by 36.4% and finance costs decreased by 27.3% YoY, respectively.
• Other income grew by 36.9% YoY.
• Net profit for the year grew by 28.5% YoY.
• Net profit margins during the year grew from 12.2% in FY17 to 16.2% in FY18.

IRB INFRA Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	58,459	56,941	-2.6%
Other income	Rs m	1,232	1,687	36.9%
Total Revenues	Rs m	59,691	58,628	-1.8%
Gross profit	Rs m	30,573	28,154	-7.9%
Depreciation	Rs m	8,548	5,440	-36.4%
Interest	Rs m	13,418	9,760	-27.3%
Profit before tax	Rs m	9,839	14,640	48.8%
Tax	Rs m	2,685	5,444	102.7%
Profit after tax	Rs m	7,154	9,197	28.5%
Gross profit margin	%	52.3	49.4
Effective tax rate	%	27.3	37.2
Net profit margin	%	12.2	16.2

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IRB INFRA Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 72 billion as compared to Rs 68 billion in FY17, thereby witnessing an increase of 6.0%.
• Long-term debt down at Rs 118 billion as compared to Rs 123 billion during FY17, a fall of 3.7%.
• Current assets rose 2% and stood at Rs 25 billion, while fixed assets fell 14% and stood at Rs 375 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 401 billion as against Rs 462 billion during FY17, thereby witnessing a fall of 13%.

IRB INFRA Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	52,716	56,925	8.0
Current Liabilities	Rs m	68,077	72,187	6.0
Long-term Debt	Rs m	122,895	118,313	-3.7
Total Liabilities	Rs m	462,228	400,684	-13.3
Current assets	Rs m	24,558	25,166	2.5
Fixed Assets	Rs m	437,669	375,269	-14.3
Total Assets	Rs m	462,228	400,684	-13.3

IRB INFRA Cash Flow Statement Analysis

• IRB INFRA's cash flow from operating activities (CFO) during FY18 stood at Rs 21 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -26 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs 4 billion, an improvement of 303% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -790 million from the Rs 95 million net cash flows seen during FY17.

IRB INFRA Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	31,920	21,323	-33.2%
Cash Flow from Investing Activities	Rs m	-29,810	-26,215	-
Cash Flow from Financing Activities	Rs m	-2,016	4,102	-
Net Cash Flow	Rs m	95	-790	-

Current Valuations for IRB INFRA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 26.2, an improvement from the EPS of Rs 20.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 223.1, stands at 14.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.4 times, while the price to sales ratio stands at 1.4 times.
• The company's price to cash flow (P/CF) ratio stood at 5.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	166.3	162.0
TTM Earnings per share	Rs	20.4	26.2
Diluted earnings per share	Rs	11.8	15.2
Price to Cash Flow	x	9.1	5.6
TTM P/E ratio	x	19.9	14.6
Price / Book Value ratio	x	1.5	1.4
Market Cap	Rs m	77,978	81,923
Dividends per share (Unadj.)	Rs	5.0	5.0

Ratio Analysis for IRB INFRA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.3x during FY18, from 0.4x during FY17. 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 2.5x during FY18, from 1.7x during FY17. 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 16.2% during FY18, from 13.6% during FY18. 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 13.9% during FY18, from 13.2% during FY17. 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 4.7% during FY18, from 4.5% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	0.4	0.3
Debtors’ Days	Days	4	9
Interest coverage	x	1.7	2.5
Debt to equity ratio	x	2.3	2.1
Return on assets	%	4.5	4.7
Return on equity	%	13.6	16.2
Return on capital employed	%	13.2	13.9

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

IRB INFRA Share Price Performance

Over the last one year, IRB INFRA share price has moved down from Rs 236.2 to Rs 223.1, registering a loss of Rs 13.1 or around 5.5%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 2,229.9 (down 1.1%). Over the last one year it has moved up from 1,600.0 to 2,229.9, a gain of 630 points (up 39.4%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of IRB INFRA