IRCON INTERNATIONAL 2020-21 Annual Report Analysis

Wed, 31 Mar

IRCON INTERNATIONAL 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.

IRCON INTERNATIONAL Income Statement Analysis

• Operating income during the year fell 0.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 21.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 8.8% in FY21 as against 7.2% in FY20.
• Depreciation charges increased by 11.0% and finance costs decreased by 28.0% YoY, respectively.
• Other income declined by 36.6% YoY.
• Net profit for the year declined by 17.3% YoY.
• Net profit margins during the year declined from 8.4% in FY20 to 7.0% in FY21.

IRCON INTERNATIONAL Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	53,911	53,420	-0.9%
Other income	Rs m	7,053	4,474	-36.6%
Total Revenues	Rs m	60,964	57,894	-5.0%
Gross profit	Rs m	3,876	4,727	21.9%
Depreciation	Rs m	829	921	11.0%
Interest	Rs m	3,684	2,653	-28.0%
Profit before tax	Rs m	6,416	5,627	-12.3%
Tax	Rs m	1,867	1,865	-0.1%
Profit after tax	Rs m	4,549	3,762	-17.3%
Gross profit margin	%	7.2	8.8
Effective tax rate	%	29.1	33.1
Net profit margin	%	8.4	7.0

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IRCON INTERNATIONAL Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 58 billion as compared to Rs 52 billion in FY20, thereby witnessing an increase of 10.5%.
• Long-term debt stood at Rs 3 billion as compared to Rs 0 million during FY20, a fall of 0.0%.
• Current assets rose 13% and stood at Rs 75 billion, while fixed assets rose 8% and stood at Rs 37 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 112 billion as against Rs 101 billion during FY20, thereby witnessing a growth of 11%.

IRCON INTERNATIONAL Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	41,713	44,031	5.6
Current Liabilities	Rs m	52,316	57,831	10.5
Long-term Debt	Rs m	0	3,121	0.0
Total Liabilities	Rs m	100,905	111,835	10.8
Current assets	Rs m	66,481	74,817	12.5
Fixed Assets	Rs m	34,425	37,018	7.5
Total Assets	Rs m	100,905	111,835	10.8

IRCON INTERNATIONAL Cash Flow Statement Analysis

• IRCON INTERNATIONAL's cash flow from operating activities (CFO) during FY21 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -8 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 2 billion, an improvement of 161% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -987 million from the Rs 358 million net cash flows seen during FY20.

IRCON INTERNATIONAL 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	-1,357	5,181	-
Cash Flow from Investing Activities	Rs m	4,467	-7,774	-
Cash Flow from Financing Activities	Rs m	-2,753	1,686	-
Net Cash Flow	Rs m	358	-987	-

Current Valuations for IRCON INTERNATIONAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.0, an decline from the EPS of Rs 48.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 88.4, stands at 22.1 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 0.8 times.
• The company's price to cash flow (P/CF) ratio stood at 23.7 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	573.2	113.6
TTM Earnings per share	Rs	48.4	8.0
Diluted earnings per share	Rs	4.8	4.0
Price to Cash Flow	x	66.7	23.7
TTM P/E ratio	x	78.8	22.1
Price / Book Value ratio	x	1.0	2.5
Market Cap	Rs m	41,844	110,757
Dividends per share (Unadj.)	Rs	4.8	3.0

Ratio Analysis for IRCON INTERNATIONAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x during FY21, from 1.3x 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 3.1x during FY21, from 2.7x 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 declined and down at 8.5% during FY21, from 10.9% 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 declined and down at 17.6% during FY21, from 24.2% 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 declined and down at 5.7% during FY21, from 8.2% 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	1.3	1.3
Debtors’ Days	Days	4	4
Interest coverage	x	2.7	3.1
Debt to equity ratio	x	0.0	0.1
Return on assets	%	8.2	5.7
Return on equity	%	10.9	8.5
Return on capital employed	%	24.2	17.6

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

IRCON INTERNATIONAL Share Price Performance

Over the last one year, IRCON INTERNATIONAL share price has moved down from Rs 381.2 to Rs 88.4, registering a loss of Rs 292.8 or around 76.8%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 21,095.8 (down 0.4%). Over the last one year it has moved up from 10,979.5 to 21,095.8, a gain of 10,116 points (up 92.1%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of IRCON INTERNATIONAL