L.G.BALAKRISHNAN 2021-22 Annual Report Analysis

Thu, 4 Aug

L.G.BALAKRISHNAN has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

L.G.BALAKRISHNAN Income Statement Analysis

• Operating income during the year rose 30.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 54.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.6% in FY22 as against 16.5% in FY21.
• Depreciation charges decreased by 0.1% and finance costs decreased by 15.6% YoY, respectively.
• Other income grew by 44.2% YoY.
• Net profit for the year grew by 85.0% YoY.
• Net profit margins during the year grew from 8.3% in FY21 to 11.7% in FY22.

L.G.BALAKRISHNAN Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	16,090	21,021	30.6%
Other income	Rs m	83	120	44.2%
Total Revenues	Rs m	16,173	21,141	30.7%
Gross profit	Rs m	2,660	4,121	54.9%
Depreciation	Rs m	833	832	-0.1%
Interest	Rs m	109	92	-15.6%
Profit before tax	Rs m	1,801	3,317	84.1%
Tax	Rs m	473	859	81.8%
Profit after tax	Rs m	1,328	2,457	85.0%
Gross profit margin	%	16.5	19.6
Effective tax rate	%	26.2	25.9
Net profit margin	%	8.3	11.7

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L.G.BALAKRISHNAN Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 5 billion as compared to Rs 4 billion in FY21, thereby witnessing an increase of 17.0%.
• Long-term debt stood at Rs 213 million as compared to Rs 192 million during FY21, a growth of 10.9%.
• Current assets rose 44% and stood at Rs 11 billion, while fixed assets rose 2% and stood at Rs 7 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 17 billion as against Rs 14 billion during FY21, thereby witnessing a growth of 24%.

L.G.BALAKRISHNAN Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	8,794	11,325	28.8
Current Liabilities	Rs m	4,401	5,148	17.0
Long-term Debt	Rs m	192	213	10.9
Total Liabilities	Rs m	13,781	17,088	24.0
Current assets	Rs m	7,325	10,534	43.8
Fixed Assets	Rs m	6,456	6,555	1.5
Total Assets	Rs m	13,781	17,088	24.0

L.G.BALAKRISHNAN Cash Flow Statement Analysis

• L.G.BALAKRISHNAN's cash flow from operating activities (CFO) during FY22 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -2 billion, an improvement of 49.8% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -228 million, an improvement of 31% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs -20 million from the Rs 566 million net cash flows seen during FY21.

L.G.BALAKRISHNAN Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	2,110	2,025	-4.1%
Cash Flow from Investing Activities	Rs m	-1,213	-1,817	-
Cash Flow from Financing Activities	Rs m	-331	-228	-
Net Cash Flow	Rs m	566	-20	-

Current Valuations for L.G.BALAKRISHNAN

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 78.3, an improvement from the EPS of Rs 42.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 662.2, stands at 7.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.8 times, while the price to sales ratio stands at 1.0 times.
• The company's price to cash flow (P/CF) ratio stood at 4.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	512.6	669.7
TTM Earnings per share	Rs	42.3	78.3
Diluted earnings per share	Rs	42.3	78.3
Price to Cash Flow	x	4.4	4.9
TTM P/E ratio	x	7.2	7.7
Price / Book Value ratio	x	0.9	1.4
Market Cap	Rs m	8,045	15,972
Dividends per share (Unadj.)	Rs	10.0	15.0

Ratio Analysis for L.G.BALAKRISHNAN

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.0x during FY22, from 1.7x during FY21. 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 37.0x during FY22, from 17.5x during FY21. 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 21.7% during FY22, from 15.1% during FY22. 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 29.5% during FY22, from 21.3% during FY21. 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 14.9% during FY22, from 10.4% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.7	2.0
Debtors’ Days	Days	560	510
Interest coverage	x	17.5	37.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	10.4	14.9
Return on equity	%	15.1	21.7
Return on capital employed	%	21.3	29.5

To see how L.G.BALAKRISHNAN has performed over the last 5 years, please visit here.

L.G.BALAKRISHNAN Share Price Performance

Over the last one year, L.G.BALAKRISHNAN share price has moved up from Rs 513.7 to Rs 662.2, registering a gain of Rs 148.5 or around 28.9%.

Overall, the S&P BSE SENSEX is up 10.0% over the year.

(To know more, check out historical annual results for L.G.BALAKRISHNAN and quarterly results for L.G.BALAKRISHNAN)

Read: Latest Annual Report Analysis of L.G.BALAKRISHNAN