JK TYRE & IND 2022-23 Annual Report Analysis

Wed, 12 Jul

JK TYRE & IND has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

JK TYRE & IND Income Statement Analysis

• Operating income during the year rose 22.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 14.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 8.4% in FY23 as against 9.0% in FY22.
• Depreciation charges increased by 5.6% and finance costs increased by 8.4% YoY, respectively.
• Other income declined by 0.1% YoY.
• Net profit for the year grew by 32.2% YoY.
• Net profit margins during the year grew from 1.7% in FY22 to 1.8% in FY23.

JK TYRE & IND Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	119,830	146,449	22.2%
Other income	Rs m	366	365	-0.1%
Total Revenues	Rs m	120,195	146,815	22.1%
Gross profit	Rs m	10,769	12,363	14.8%
Depreciation	Rs m	3,854	4,071	5.6%
Interest	Rs m	4,191	4,545	8.4%
Profit before tax	Rs m	3,090	4,113	33.1%
Tax	Rs m	1,087	1,465	34.8%
Profit after tax	Rs m	2,003	2,647	32.2%
Gross profit margin	%	9.0	8.4
Effective tax rate	%	35.2	35.6
Net profit margin	%	1.7	1.8

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JK TYRE & IND Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 53 billion as compared to Rs 56 billion in FY22, thereby witnessing an decrease of -6.0%.
• Long-term debt down at Rs 24 billion as compared to Rs 25 billion during FY22, a fall of 4.7%.
• Current assets rose 1% and stood at Rs 54 billion, while fixed assets rose 1% and stood at Rs 69 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 123 billion as against Rs 122 billion during FY22, thereby witnessing a growth of 1%.

JK TYRE & IND Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	28,483	33,962	19.2
Current Liabilities	Rs m	55,979	52,609	-6.0
Long-term Debt	Rs m	24,759	23,604	-4.7
Total Liabilities	Rs m	121,607	123,390	1.5
Current assets	Rs m	53,339	54,115	1.5
Fixed Assets	Rs m	68,198	69,216	1.5
Total Assets	Rs m	121,607	123,390	1.5

JK TYRE & IND Cash Flow Statement Analysis

• JK TYRE & IND's cash flow from operating activities (CFO) during FY23 stood at Rs 12 billion, an improvement of 253.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -4 billion, an improvement of 63.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -7 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 791 million from the Rs 54 million net cash flows seen during FY22.

JK TYRE & IND Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	3,461	12,242	253.8%
Cash Flow from Investing Activities	Rs m	-2,453	-4,005	-
Cash Flow from Financing Activities	Rs m	-962	-7,473	-
Net Cash Flow	Rs m	54	791	1,367.5%

Current Valuations for JK TYRE & IND

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.8, an improvement from the EPS of Rs 8.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 253.0, stands at 23.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.8 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 5.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	486.7	594.8
TTM Earnings per share	Rs	8.1	10.8
Diluted earnings per share	Rs	8.1	10.8
Price to Cash Flow	x	4.9	5.7
TTM P/E ratio	x	14.4	23.5
Price / Book Value ratio	x	1.2	1.1
Market Cap	Rs m	33,192	38,153
Dividends per share (Unadj.)	Rs	1.5	2.0

Ratio Analysis for JK TYRE & IND

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.0x during FY23, from 1.0x during FY22. 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 1.9x during FY23, from 1.7x during FY22. 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 7.8% during FY23, from 7.0% during FY23. 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 15.0% during FY23, from 13.7% during FY22. 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 5.8% during FY23, from 5.1% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	1.0	1.0
Debtors’ Days	Days	6	6
Interest coverage	x	1.7	1.9
Debt to equity ratio	x	0.9	0.7
Return on assets	%	5.1	5.8
Return on equity	%	7.0	7.8
Return on capital employed	%	13.7	15.0

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

JK TYRE & IND Share Price Performance

Over the last one year, JK TYRE & IND share price has moved up from Rs 114.7 to Rs 253.0, registering a gain of Rs 138.4 or around 120.7%.

Overall, the S&P BSE SENSEX is up 20.5% over the year.

(To know more, check out historical annual results for JK TYRE & IND and quarterly results for JK TYRE & IND)