IRB INFRA 2018-19 Annual Report Analysis

Sun, 31 Mar

IRB INFRA 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.

IRB INFRA Income Statement Analysis

• Operating income during the year rose 17.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 4.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 43.9% in FY19 as against 49.4% in FY18.
• Depreciation charges decreased by 0.8% and finance costs increased by 15.4% YoY, respectively.
• Other income grew by 16.0% YoY.
• Net profit for the year declined by 7.6% YoY.
• Net profit margins during the year declined from 16.2% in FY18 to 12.7% in FY19.

IRB INFRA Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	56,941	67,070	17.8%
Other income	Rs m	1,687	1,956	16.0%
Total Revenues	Rs m	58,628	69,026	17.7%
Gross profit	Rs m	28,154	29,435	4.6%
Depreciation	Rs m	5,440	5,395	-0.8%
Interest	Rs m	9,760	11,263	15.4%
Profit before tax	Rs m	14,640	14,733	0.6%
Tax	Rs m	5,444	6,234	14.5%
Profit after tax	Rs m	9,197	8,500	-7.6%
Gross profit margin	%	49.4	43.9
Effective tax rate	%	37.2	42.3
Net profit margin	%	16.2	12.7

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IRB INFRA Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 76 billion as compared to Rs 72 billion in FY18, thereby witnessing an increase of 5.0%.
• Long-term debt stood at Rs 144 billion as compared to Rs 118 billion during FY18, a growth of 21.8%.
• Current assets rose 71% and stood at Rs 43 billion, while fixed assets fell 0% and stood at Rs 374 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 418 billion as against Rs 401 billion during FY18, thereby witnessing a growth of 4%.

IRB INFRA Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	56,925	63,152	10.9
Current Liabilities	Rs m	72,187	75,824	5.0
Long-term Debt	Rs m	118,313	144,076	21.8
Total Liabilities	Rs m	400,684	417,571	4.2
Current assets	Rs m	25,166	43,114	71.3
Fixed Assets	Rs m	375,269	374,457	-0.2
Total Assets	Rs m	400,684	417,571	4.2

IRB INFRA Cash Flow Statement Analysis

• IRB INFRA's cash flow from operating activities (CFO) during FY19 stood at Rs 27 billion, an improvement of 27.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -41 billion, an improvement of 55.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs 14 billion, an improvement of 250% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 661 million from the Rs -790 million net cash flows seen during FY18.

IRB INFRA 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	21,323	27,099	27.1%
Cash Flow from Investing Activities	Rs m	-26,215	-40,814	-
Cash Flow from Financing Activities	Rs m	4,102	14,376	250.5%
Net Cash Flow	Rs m	-790	661	-

Current Valuations for IRB INFRA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 24.2, an decline from the EPS of Rs 26.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 145.3, stands at 10.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.4 times, while the price to sales ratio stands at 0.8 times.
• The company's price to cash flow (P/CF) ratio stood at 5.0 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	162.0	190.8
TTM Earnings per share	Rs	26.2	24.2
Diluted earnings per share	Rs	15.2	14.1
Price to Cash Flow	x	9.2	5.0
TTM P/E ratio	x	14.6	10.3
Price / Book Value ratio	x	1.4	1.1
Market Cap	Rs m	81,923	69,508
Dividends per share (Unadj.)	Rs	5.0	2.5

Ratio Analysis for IRB INFRA

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.6x during FY19, from 0.3x 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 deteriorated and stood at 2.3x during FY19, from 2.5x 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 declined and down at 13.5% during FY19, from 16.2% 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 declined and down at 12.5% during FY19, from 13.9% 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 4.7% during FY19, from 4.7% 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	0.3	0.6
Debtors’ Days	Days	9	6
Interest coverage	x	2.5	2.3
Debt to equity ratio	x	2.1	2.3
Return on assets	%	4.7	4.7
Return on equity	%	16.2	13.5
Return on capital employed	%	13.9	12.5

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 223.1 to Rs 145.3, registering a loss of Rs 77.8 or around 34.9%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 2,077.1 (up 0.6%). Over the last one year it has moved down from 2,229.9 to 2,077.1, a loss of 153 points (down 6.9%).

Overall, the S&P BSE SENSEX is up 16.3% 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