KPIT TECHNOLOGIES 2022-23 Annual Report Analysis

Tue, 15 Aug

KPIT TECHNOLOGIES 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.

KPIT TECHNOLOGIES Income Statement Analysis

• Operating income during the year rose 38.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 48.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.9% in FY23 as against 17.6% in FY22.
• Depreciation charges increased by 22.4% and finance costs increased by 66.6% YoY, respectively.
• Other income declined by 28.4% YoY.
• Net profit for the year grew by 40.0% YoY.
• Net profit margins during the year grew from 11.4% in FY22 to 11.5% in FY23.

KPIT TECHNOLOGIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	24,324	33,650	38.3%
Other income	Rs m	561	402	-28.4%
Total Revenues	Rs m	24,885	34,052	36.8%
Gross profit	Rs m	4,275	6,353	48.6%
Depreciation	Rs m	1,196	1,464	22.4%
Interest	Rs m	194	323	66.6%
Profit before tax	Rs m	3,445	4,968	44.2%
Tax	Rs m	683	1,099	60.9%
Profit after tax	Rs m	2,762	3,869	40.0%
Gross profit margin	%	17.6	18.9
Effective tax rate	%	19.8	22.1
Net profit margin	%	11.4	11.5

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KPIT TECHNOLOGIES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 12 billion as compared to Rs 7 billion in FY22, thereby witnessing an increase of 65.1%.
• Long-term debt down at Rs 2 million as compared to Rs 19 million during FY22, a fall of 87.9%.
• Current assets fell 1% and stood at Rs 15 billion, while fixed assets rose 145% and stood at Rs 18 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 33 billion as against Rs 23 billion during FY22, thereby witnessing a growth of 47%.

KPIT TECHNOLOGIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	12,897	16,244	26.0
Current Liabilities	Rs m	7,077	11,681	65.1
Long-term Debt	Rs m	19	2	-87.9
Total Liabilities	Rs m	22,598	33,307	47.4
Current assets	Rs m	15,142	15,016	-0.8
Fixed Assets	Rs m	7,456	18,291	145.3
Total Assets	Rs m	22,598	33,307	47.4

KPIT TECHNOLOGIES Cash Flow Statement Analysis

• KPIT TECHNOLOGIES's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 1 billion from the Rs 563 million net cash flows seen during FY22.

KPIT TECHNOLOGIES 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	4,750	4,624	-2.6%
Cash Flow from Investing Activities	Rs m	-3,024	-2,023	-
Cash Flow from Financing Activities	Rs m	-1,267	-1,831	-
Net Cash Flow	Rs m	563	1,122	99.2%

Current Valuations for KPIT TECHNOLOGIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 14.3, an improvement from the EPS of Rs 10.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,127.3, stands at 71.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 19.0 times, while the price to sales ratio stands at 9.1 times.
• The company's price to cash flow (P/CF) ratio stood at 35.1 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	90.1	124.5
TTM Earnings per share	Rs	10.2	14.3
Diluted earnings per share	Rs	10.1	14.1
Price to Cash Flow	x	41.6	35.1
TTM P/E ratio	x	59.7	71.6
Price / Book Value ratio	x	10.1	11.5
Market Cap	Rs m	130,587	187,418
Dividends per share (Unadj.)	Rs	3.1	4.1

Ratio Analysis for KPIT TECHNOLOGIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY23, from 2.1x 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 16.4x during FY23, from 18.8x 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 23.8% during FY23, from 21.4% 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 32.6% during FY23, from 28.2% 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 12.6% during FY23, from 13.1% 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	2.1	1.3
Debtors’ Days	Days	66	84
Interest coverage	x	18.8	16.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.1	12.6
Return on equity	%	21.4	23.8
Return on capital employed	%	28.2	32.6

To see how KPIT TECHNOLOGIES has performed over the last 5 years, please visit here.

KPIT TECHNOLOGIES Share Price Performance

Over the last one year, KPIT TECHNOLOGIES share price has moved up from Rs 569.9 to Rs 1,127.3, registering a gain of Rs 557.4 or around 97.8%.

Meanwhile, the S&P BSE IT Index is trading at Rs 31,218.6 (up 0.6%). Over the last one year it has moved up from 30,350.8 to 31,218.6, a gain of 868 points (up 2.9%).

Overall, the S&P BSE SENSEX is up 10.2% over the year.

(To know more, check out historical annual results for KPIT TECHNOLOGIES and quarterly results for KPIT TECHNOLOGIES)