KHAITAN CHEM 2020-21 Annual Report Analysis

Wed, 31 Mar

KHAITAN CHEM 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.

KHAITAN CHEM Income Statement Analysis

• Operating income during the year rose 11.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 29.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 12.3% in FY21 as against 10.6% in FY20.
• Depreciation charges decreased by 3.8% and finance costs decreased by 26.2% YoY, respectively.
• Other income declined by 75.7% YoY.
• Net profit for the year grew by 64.9% YoY.
• Net profit margins during the year grew from 3.5% in FY20 to 5.1% in FY21.

KHAITAN CHEM Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	4,371	4,872	11.4%
Other income	Rs m	23	6	-75.7%
Total Revenues	Rs m	4,394	4,877	11.0%
Gross profit	Rs m	462	598	29.4%
Depreciation	Rs m	85	82	-3.8%
Interest	Rs m	184	136	-26.2%
Profit before tax	Rs m	216	386	78.9%
Tax	Rs m	65	137	111.5%
Profit after tax	Rs m	151	249	64.9%
Gross profit margin	%	10.6	12.3
Effective tax rate	%	30.1	35.5
Net profit margin	%	3.5	5.1

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KHAITAN CHEM Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 1 billion as compared to Rs 2 billion in FY20, thereby witnessing an decrease of -30.3%.
• Long-term debt down at Rs 190 million as compared to Rs 191 million during FY20, a fall of 0.2%.
• Current assets fell 12% and stood at Rs 2 billion, while fixed assets fell 2% and stood at Rs 1 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 4 billion as against Rs 4 billion during FY20, thereby witnessing a fall of 9%.

KHAITAN CHEM Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	1,531	1,742	13.8
Current Liabilities	Rs m	2,065	1,439	-30.3
Long-term Debt	Rs m	191	190	-0.2
Total Liabilities	Rs m	3,907	3,543	-9.3
Current assets	Rs m	2,823	2,486	-11.9
Fixed Assets	Rs m	1,084	1,057	-2.5
Total Assets	Rs m	3,907	3,543	-9.3

KHAITAN CHEM Cash Flow Statement Analysis

• KHAITAN CHEM's cash flow from operating activities (CFO) during FY21 stood at Rs 843 million, an improvement of 425.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -56 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -788 million on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 0 million from the Rs 0 million net cash flows seen during FY20.

KHAITAN CHEM 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	161	843	425.0%
Cash Flow from Investing Activities	Rs m	10	-56	-
Cash Flow from Financing Activities	Rs m	-171	-788	-
Net Cash Flow	Rs m	0	0	-

Current Valuations for KHAITAN CHEM

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.6, an improvement from the EPS of Rs 1.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 22.0, stands at 8.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.2 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 5.3 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	45.1	50.2
TTM Earnings per share	Rs	1.6	2.6
Diluted earnings per share	Rs	1.6	2.6
Price to Cash Flow	x	2.3	5.3
TTM P/E ratio	x	3.5	8.1
Price / Book Value ratio	x	0.4	1.0
Market Cap	Rs m	672	1,745
Dividends per share (Unadj.)	Rs	0.2	0.3

Ratio Analysis for KHAITAN CHEM

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.7x during FY21, from 1.4x 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 3.8x during FY21, from 2.2x 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 14.3% during FY21, from 9.9% 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 improved and stood at 27.0% during FY21, from 23.2% 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 improved and stood at 10.9% during FY21, from 8.6% 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	1.4	1.7
Debtors’ Days	Days	447	327
Interest coverage	x	2.2	3.8
Debt to equity ratio	x	0.1	0.1
Return on assets	%	8.6	10.9
Return on equity	%	9.9	14.3
Return on capital employed	%	23.2	27.0

To see how KHAITAN CHEM has performed over the last 5 years, please visit here.

KHAITAN CHEM Share Price Performance

Over the last one year, KHAITAN CHEM share price has moved up from Rs 5.5 to Rs 22.0, registering a gain of Rs 16.5 or around 301.5%.

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

(To know more, check out historical annual results for KHAITAN CHEM and quarterly results for KHAITAN CHEM)

Read: Latest Annual Report Analysis of KHAITAN CHEM