KOTHARI PRODUCTS 2017-18 Annual Report Analysis

Sat, 31 Mar

KOTHARI PRODUCTS 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.

KOTHARI PRODUCTS Income Statement Analysis

• Operating income during the year rose 0.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 42.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 1.7% in FY18 as against 2.9% in FY17.
• Depreciation charges increased by 9.0% and finance costs decreased by 42.0% YoY, respectively.
• Other income declined by 38.0% YoY.
• Net profit for the year declined by 30.7% YoY.
• Net profit margins during the year declined from 1.3% in FY17 to 0.9% in FY18.

KOTHARI PRODUCTS Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	63,343	63,666	0.5%
Other income	Rs m	208	129	-38.0%
Total Revenues	Rs m	63,551	63,795	0.4%
Gross profit	Rs m	1,827	1,056	-42.2%
Depreciation	Rs m	27	29	9.0%
Interest	Rs m	775	449	-42.0%
Profit before tax	Rs m	1,233	706	-42.7%
Tax	Rs m	397	127	-68.1%
Profit after tax	Rs m	836	579	-30.7%
Gross profit margin	%	2.9	1.7
Effective tax rate	%	32.2	18.0
Net profit margin	%	1.3	0.9

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KOTHARI PRODUCTS Balance Sheet Analysis

• The company's current liabilities during FY18 down at Rs 25 billion as compared to Rs 29 billion in FY17, thereby witnessing an decrease of -15.1%.
• Long-term debt stood at Rs 1 billion as compared to Rs 880 million during FY17, a growth of 49.1%.
• Current assets fell 16% and stood at Rs 30 billion, while fixed assets rose 65% and stood at Rs 6 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 36 billion as against Rs 40 billion during FY17, thereby witnessing a fall of 9%.

KOTHARI PRODUCTS Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	9,578	10,126	5.7
Current Liabilities	Rs m	29,448	24,998	-15.1
Long-term Debt	Rs m	880	1,313	49.1
Total Liabilities	Rs m	39,906	36,432	-8.7
Current assets	Rs m	36,275	30,425	-16.1
Fixed Assets	Rs m	3,631	6,007	65.4
Total Assets	Rs m	39,906	36,432	-8.7

KOTHARI PRODUCTS Cash Flow Statement Analysis

• KOTHARI PRODUCTS's cash flow from operating activities (CFO) during FY18 stood at Rs -8 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs 6 billion, an improvement of 307.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs 2 billion, an improvement of 200% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -414 million from the Rs -423 million net cash flows seen during FY17.

KOTHARI PRODUCTS 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	123	-7,811	-
Cash Flow from Investing Activities	Rs m	1,350	5,502	307.5%
Cash Flow from Financing Activities	Rs m	-1,896	1,895	-
Net Cash Flow	Rs m	-423	-414	-

Current Valuations for KOTHARI PRODUCTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.4, an decline from the EPS of Rs 28.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 150.8, stands at 10.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.4 times, while the price to sales ratio stands at 0.1 times.
• The company's price to cash flow (P/CF) ratio stood at 9.6 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	2,122.8	2,133.6
TTM Earnings per share	Rs	28.0	19.4
Diluted earnings per share	Rs	28.0	19.4
Price to Cash Flow	x	6.8	9.6
TTM P/E ratio	x	9.1	10.2
Price / Book Value ratio	x	0.6	0.6
Market Cap	Rs m	5,773	5,811
Dividends per share (Unadj.)	Rs	3.0	1.5

Ratio Analysis for KOTHARI PRODUCTS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x 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 2.6x during FY18, from 2.6x 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 declined and down at 5.7% during FY18, from 8.7% 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 declined and down at 10.1% during FY18, from 19.2% 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 declined and down at 2.8% during FY18, from 4.0% 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	1.2
Debtors’ Days	Days	967	1,067
Interest coverage	x	2.6	2.6
Debt to equity ratio	x	0.1	0.1
Return on assets	%	4.0	2.8
Return on equity	%	8.7	5.7
Return on capital employed	%	19.2	10.1

To see how KOTHARI PRODUCTS has performed over the last 5 years, please visit here.

KOTHARI PRODUCTS Share Price Performance

Over the last one year, KOTHARI PRODUCTS share price has moved down from Rs 196.1 to Rs 150.8, registering a loss of Rs 45.3 or around 23.1%.

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

(To know more, check out historical annual results for KOTHARI PRODUCTS and quarterly results for KOTHARI PRODUCTS)