JK CEMENT 2020-21 Annual Report Analysis

Wed, 31 Mar

JK CEMENT 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.

JK CEMENT Income Statement Analysis

• Operating income during the year rose 13.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 26.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.3% in FY21 as against 20.9% in FY20.
• Depreciation charges increased by 6.3% and finance costs decreased by 8.5% YoY, respectively.
• Other income grew by 32.4% YoY.
• Net profit for the year grew by 45.5% YoY.
• Net profit margins during the year grew from 8.3% in FY20 to 10.6% in FY21.

JK CEMENT Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	58,016	66,061	13.9%
Other income	Rs m	853	1,130	32.4%
Total Revenues	Rs m	58,870	67,191	14.1%
Gross profit	Rs m	12,134	15,387	26.8%
Depreciation	Rs m	2,880	3,062	6.3%
Interest	Rs m	2,764	2,528	-8.5%
Profit before tax	Rs m	7,344	10,927	48.8%
Tax	Rs m	2,511	3,896	55.2%
Profit after tax	Rs m	4,834	7,031	45.5%
Gross profit margin	%	20.9	23.3
Effective tax rate	%	34.2	35.7
Net profit margin	%	8.3	10.6

JK CEMENT Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 20 billion as compared to Rs 18 billion in FY20, thereby witnessing an increase of 7.3%.
• Long-term debt stood at Rs 30 billion as compared to Rs 27 billion during FY20, a growth of 10.7%.
• Current assets rose 42% and stood at Rs 32 billion, while fixed assets rose 6% and stood at Rs 67 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 99 billion as against Rs 85 billion during FY20, thereby witnessing a growth of 16%.

JK CEMENT Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	30,277	37,367	23.4
Current Liabilities	Rs m	18,247	19,574	7.3
Long-term Debt	Rs m	27,035	29,931	10.7
Total Liabilities	Rs m	85,420	98,720	15.6
Current assets	Rs m	22,346	31,831	42.4
Fixed Assets	Rs m	63,075	66,889	6.0
Total Assets	Rs m	85,420	98,720	15.6

JK CEMENT Cash Flow Statement Analysis

• JK CEMENT's cash flow from operating activities (CFO) during FY21 stood at Rs 16 billion, an improvement of 15.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -13 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 1 billion from the Rs -2 billion net cash flows seen during FY20.

JK CEMENT 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	13,718	15,903	15.9%
Cash Flow from Investing Activities	Rs m	-14,765	-13,437	-
Cash Flow from Financing Activities	Rs m	-1,131	-1,375	-
Net Cash Flow	Rs m	-2,246	1,082	-

Current Valuations for JK CEMENT

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 91.0, an improvement from the EPS of Rs 62.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,894.1, stands at 31.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.0 times, while the price to sales ratio stands at 3.4 times.
• The company's price to cash flow (P/CF) ratio stood at 15.0 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	750.8	854.9
TTM Earnings per share	Rs	62.6	91.0
Diluted earnings per share	Rs	62.6	91.0
Price to Cash Flow	x	9.4	15.0
TTM P/E ratio	x	14.6	31.8
Price / Book Value ratio	x	2.9	4.1
Market Cap	Rs m	89,029	151,794
Dividends per share (Unadj.)	Rs	7.5	15.0

Ratio Analysis for JK CEMENT

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY21, from 1.2x 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 5.3x during FY21, from 3.7x 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 improved and stood at 18.8% during FY21, from 16.0% 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 20.0% during FY21, from 17.6% 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 9.7% during FY21, from 8.9% 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	1.2	1.6
Debtors’ Days	Days	168	200
Interest coverage	x	3.7	5.3
Debt to equity ratio	x	0.9	0.8
Return on assets	%	8.9	9.7
Return on equity	%	16.0	18.8
Return on capital employed	%	17.6	20.0

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

JK CEMENT Share Price Performance

Over the last one year, JK CEMENT share price has moved up from Rs 939.6 to Rs 2,894.1, registering a gain of Rs 1,954.6 or around 208.0%.

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

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

Read: Latest Annual Report Analysis of JK CEMENT