KIRLOSKAR BROS 2017-18 Annual Report Analysis

Sat, 31 Mar

KIRLOSKAR BROS has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

KIRLOSKAR BROS Income Statement Analysis

• Operating income during the year rose 13.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 57.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 5.5% in FY18 as against 4.0% in FY17.
• Depreciation charges decreased by 9.8% and finance costs decreased by 10.4% YoY, respectively.
• Other income declined by 28.5% YoY.
• Net profit for the year declined by 2743.5% YoY.
• Net profit margins during the year grew from 0.1% in FY17 to 1.7% in FY18.

KIRLOSKAR BROS Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	23,958	27,076	13.0%
Other income	Rs m	306	219	-28.5%
Total Revenues	Rs m	24,264	27,295	12.5%
Gross profit	Rs m	953	1,499	57.3%
Depreciation	Rs m	649	586	-9.8%
Interest	Rs m	445	399	-10.4%
Profit before tax	Rs m	164	733	346.5%
Tax	Rs m	182	268	47.4%
Profit after tax	Rs m	-18	465	-2,743.5%
Gross profit margin	%	4.0	5.5
Effective tax rate	%	110.7	36.6
Net profit margin	%	-0.1	1.7

Don't Miss: Best Chance to Access Midcap Stocks Research at 80% OFF

KIRLOSKAR BROS Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 15 billion as compared to Rs 14 billion in FY17, thereby witnessing an increase of 5.3%.
• Long-term debt stood at Rs 821 million as compared to Rs 502 million during FY17, a growth of 63.5%.
• Current assets rose 14% and stood at Rs 18 billion, while fixed assets fell 15% and stood at Rs 7 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 25 billion as against Rs 24 billion during FY17, thereby witnessing a growth of 4%.

KIRLOSKAR BROS Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	8,981	9,425	4.9
Current Liabilities	Rs m	13,800	14,526	5.3
Long-term Debt	Rs m	502	821	63.5
Total Liabilities	Rs m	24,275	25,198	3.8
Current assets	Rs m	16,000	18,177	13.6
Fixed Assets	Rs m	8,275	7,021	-15.2
Total Assets	Rs m	24,275	25,198	3.8

KIRLOSKAR BROS Cash Flow Statement Analysis

• KIRLOSKAR BROS's cash flow from operating activities (CFO) during FY18 stood at Rs 1 billion, an improvement of 9.2% on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -452 million, an improvement of 36.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -521 million, an improvement of 10% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 136 million from the Rs 78 million net cash flows seen during FY17.

KIRLOSKAR BROS Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	1,004	1,096	9.2%
Cash Flow from Investing Activities	Rs m	-332	-452	-
Cash Flow from Financing Activities	Rs m	-579	-521	-
Net Cash Flow	Rs m	78	136	74.9%

Current Valuations for KIRLOSKAR BROS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.9, an improvement from the EPS of Rs -0.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 307.6, stands at 37.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.6 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 25.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	301.7	341.0
TTM Earnings per share	Rs	-0.2	5.9
Diluted earnings per share	Rs	-0.2	5.9
Price to Cash Flow	x	31.9	25.0
TTM P/E ratio	x	67.2	37.3
Price / Book Value ratio	x	1.7	2.8
Market Cap	Rs m	15,104	26,263
Dividends per share (Unadj.)	Rs	1.0	2.5

Ratio Analysis for KIRLOSKAR BROS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x during FY18, from 1.2x during FY17. 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 2.8x during FY18, from 1.4x during FY17. 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 4.9% during FY18, from -0.2% during FY18. 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 11.0% during FY18, from 6.4% during FY17. 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 3.4% during FY18, from 1.8% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	1.2	1.3
Debtors’ Days	Days	81	73
Interest coverage	x	1.4	2.8
Debt to equity ratio	x	0.1	0.1
Return on assets	%	1.8	3.4
Return on equity	%	-0.2	4.9
Return on capital employed	%	6.4	11.0

To see how KIRLOSKAR BROS has performed over the last 5 years, please visit here.

KIRLOSKAR BROS Share Price Performance

Over the last one year, KIRLOSKAR BROS share price has moved up from Rs 253.7 to Rs 307.6, registering a gain of Rs 53.9 or around 21.2%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,476.7 (down 0.1%). Over the last one year it has moved up from 16,446.0 to 18,476.7, a gain of 2,031 points (up 12.3%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for KIRLOSKAR BROS and quarterly results for KIRLOSKAR BROS)

Read: Latest Annual Report Analysis of KIRLOSKAR BROS