JM FINANCIAL 2022-23 Annual Report Analysis

Wed, 12 Jul

JM FINANCIAL 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.

JM FINANCIAL Income Statement Analysis

• Operating income during the year fell 11.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 25.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 55.1% in FY23 as against 65.0% in FY22.
• Depreciation charges increased by 10.8% and finance costs increased by 8.9% YoY, respectively.
• Other income grew by 567.9% YoY.
• Net profit for the year declined by 28.6% YoY.
• Net profit margins during the year declined from 26.8% in FY22 to 21.7% in FY23.

JM FINANCIAL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	37,072	32,651	-11.9%
Other income	Rs m	561	3,748	567.9%
Total Revenues	Rs m	37,633	36,399	-3.3%
Gross profit	Rs m	24,114	17,982	-25.4%
Depreciation	Rs m	378	419	10.8%
Interest	Rs m	10,817	11,785	8.9%
Profit before tax	Rs m	13,480	9,526	-29.3%
Tax	Rs m	3,557	2,439	-31.4%
Profit after tax	Rs m	9,924	7,088	-28.6%
Gross profit margin	%	65.0	55.1
Effective tax rate	%	26.4	25.6
Net profit margin	%	26.8	21.7

Download Now: 7 Unstoppable Growth Engines of India's $10 Trillion Bull Run...

JM FINANCIAL Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 52 billion as compared to Rs 55 billion in FY22, thereby witnessing an decrease of -5.3%.
• Long-term debt stood at Rs 126 billion as compared to Rs 95 billion during FY22, a growth of 33.6%.
• Current assets rose 11% and stood at Rs 270 billion, while fixed assets rose 56% and stood at Rs 22 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 291 billion as against Rs 256 billion during FY22, thereby witnessing a growth of 14%.

JM FINANCIAL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	76,685	81,197	5.9
Current Liabilities	Rs m	55,080	52,162	-5.3
Long-term Debt	Rs m	94,531	126,255	33.6
Total Liabilities	Rs m	255,736	291,252	13.9
Current assets	Rs m	241,985	269,745	11.5
Fixed Assets	Rs m	13,751	21,507	56.4
Total Assets	Rs m	255,736	291,252	13.9

JM FINANCIAL Cash Flow Statement Analysis

• JM FINANCIAL's cash flow from operating activities (CFO) during FY23 stood at Rs -24 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -5 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 22 billion, an improvement of 68% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -7 billion from the Rs 4 billion net cash flows seen during FY22.

JM FINANCIAL 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	-34,581	-24,487	-
Cash Flow from Investing Activities	Rs m	26,139	-4,508	-
Cash Flow from Financing Activities	Rs m	12,807	21,533	68.1%
Net Cash Flow	Rs m	4,366	-7,389	-

Current Valuations for JM FINANCIAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.4, an decline from the EPS of Rs 10.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 73.9, stands at 10.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.9 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 9.0 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	38.9	34.2
TTM Earnings per share	Rs	10.4	7.4
Diluted earnings per share	Rs	10.4	7.4
Price to Cash Flow	x	6.3	9.0
TTM P/E ratio	x	6.5	10.0
Price / Book Value ratio	x	1.1	0.8
Market Cap	Rs m	84,792	67,576
Dividends per share (Unadj.)	Rs	1.7	1.8

Ratio Analysis for JM FINANCIAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 5.2x during FY23, from 4.4x 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 deteriorated and stood at 1.8x during FY23, from 2.2x 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 declined and down at 8.7% during FY23, from 12.9% 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 declined and down at 10.3% during FY23, from 14.2% 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 declined and down at 6.5% during FY23, from 8.1% 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	4.4	5.2
Debtors’ Days	Days	5	14
Interest coverage	x	2.2	1.8
Debt to equity ratio	x	1.2	1.6
Return on assets	%	8.1	6.5
Return on equity	%	12.9	8.7
Return on capital employed	%	14.2	10.3

To see how JM FINANCIAL has performed over the last 5 years, please visit here.

JM FINANCIAL Share Price Performance

Over the last one year, JM FINANCIAL share price has moved up from Rs 63.0 to Rs 73.9, registering a gain of Rs 10.9 or around 17.3%.

Overall, the S&P BSE SENSEX is up 20.2% over the year.

(To know more, check out historical annual results for JM FINANCIAL and quarterly results for JM FINANCIAL)