KIRLOSKAR BROS. 2017-18 Annual Report Analysis

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KIRLOSKAR BROS. 2017-18 Annual Report Analysis
Tue, 18 Dec

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 7.2% 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 5.4% in FY18 as against 3.7% in FY17.
  • Depreciation charges decreased by 9.8% and finance costs decreased by 10.4% YoY, respectively.
  • Other income declined by 28.4% YoY.
  • Net profit for the year declined by 2742.0% 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 25,692 27,534 7.2%
Other income Rs m 306 219 -28.4%
Total Revenues Rs m 25,998 27,753 6.7%
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 164 733 346.6%
Tax Rs m 182 268 47.4%
Profit after tax Rs m -18 465 -2,742.0%
Gross profit margin % 3.7 5.4
Effective tax rate % 110.7 36.6
Net profit margin % -0.1 1.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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 1% and stood at Rs 5 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 26 billion as against Rs 25 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 24,509 25,546 4.2
 
Current assets Rs m 16,000 18,176 13.6
Fixed Assets Rs m 5,299 5,234 -1.2
Total Assets Rs m 24,509 25,546 4.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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 74.7%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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 150.8, stands at 15.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.6 times, while the price to sales ratio stands at 0.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 11.4 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 323.5 346.7
TTM Earnings per share Rs -0.2 5.9
Diluted earnings per share Rs -0.2 5.9
Price to Cash Flow x 18.9 11.4
TTM P/E ratio x 15.0 15.0
Price / Book Value ratio x 1.7 1.6
Market Cap Rs m 11,971 11,967
Dividends per share (Unadj.) Rs 1.0 2.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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 deteriorated 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 1.7% 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 76 72
Interest coverage x 1.4 2.8
Debt to equity ratio x 0.1 0.1
Return on assets % 1.7 3.4
Return on equity % -0.2 4.9
Return on capital employed % 6.4 11.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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 275.4 to Rs 150.8, registering a loss of Rs 124.7 or around 45.3%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,601.7 (up 0.7%). Over the last one year it has moved up from 18,447.1 to 18,601.7, a gain of 155 points (up 0.8%).

Overall, the S&P BSE SENSEX is up 7.4% over the year.

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

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