L.G.BALAKRISHNAN 2022-23 Annual Report Analysis

Fri, 31 Mar

L.G.BALAKRISHNAN 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.

L.G.BALAKRISHNAN Income Statement Analysis

• Operating income during the year rose 4.8% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 2.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 18.2% in FY23 as against 19.6% in FY22.
• Depreciation charges decreased by 4.5% and finance costs decreased by 16.3% YoY, respectively.
• Other income grew by 115.2% YoY.
• Net profit for the year grew by 2.7% YoY.
• Net profit margins during the year declined from 11.7% in FY22 to 11.5% in FY23.

L.G.BALAKRISHNAN Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	21,021	22,030	4.8%
Other income	Rs m	120	259	115.2%
Total Revenues	Rs m	21,141	22,289	5.4%
Gross profit	Rs m	4,121	4,016	-2.5%
Depreciation	Rs m	832	795	-4.5%
Interest	Rs m	92	77	-16.3%
Profit before tax	Rs m	3,317	3,403	2.6%
Tax	Rs m	859	880	2.4%
Profit after tax	Rs m	2,457	2,523	2.7%
Gross profit margin	%	19.6	18.2
Effective tax rate	%	25.9	25.9
Net profit margin	%	11.7	11.5

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L.G.BALAKRISHNAN Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 4 billion as compared to Rs 5 billion in FY22, thereby witnessing an decrease of -14.0%.
• Long-term debt down at Rs 168 million as compared to Rs 213 million during FY22, a fall of 21.0%.
• Current assets fell 0% and stood at Rs 11 billion, while fixed assets rose 24% and stood at Rs 8 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 19 billion as against Rs 17 billion during FY22, thereby witnessing a growth of 9%.

L.G.BALAKRISHNAN Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	11,325	13,653	20.6
Current Liabilities	Rs m	5,188	4,460	-14.0
Long-term Debt	Rs m	213	168	-21.0
Total Liabilities	Rs m	17,129	18,731	9.4
Current assets	Rs m	10,586	10,547	-0.4
Fixed Assets	Rs m	6,542	8,103	23.9
Total Assets	Rs m	17,129	18,731	9.4

L.G.BALAKRISHNAN Cash Flow Statement Analysis

• L.G.BALAKRISHNAN's cash flow from operating activities (CFO) during FY23 stood at Rs 2 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 -578 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -484 million from the Rs 20 million net cash flows seen during FY22.

L.G.BALAKRISHNAN 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	2,025	1,667	-17.6%
Cash Flow from Investing Activities	Rs m	-1,817	-1,573	-
Cash Flow from Financing Activities	Rs m	-187	-578	-
Net Cash Flow	Rs m	20	-484	-

Current Valuations for L.G.BALAKRISHNAN

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 80.4, an improvement from the EPS of Rs 78.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 740.5, stands at 9.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.7 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 6.2 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	669.7	701.8
TTM Earnings per share	Rs	78.3	80.4
Diluted earnings per share	Rs	78.3	80.4
Price to Cash Flow	x	5.1	6.2
TTM P/E ratio	x	6.9	9.2
Price / Book Value ratio	x	1.4	1.5
Market Cap	Rs m	15,972	20,626
Dividends per share (Unadj.)	Rs	15.0	16.0

Ratio Analysis for L.G.BALAKRISHNAN

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.4x during FY23, from 2.0x 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 improved and stood at 45.1x during FY23, from 37.0x 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 declined and down at 18.5% during FY23, from 21.7% 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 declined and down at 25.2% during FY23, from 29.5% 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 13.9% during FY23, from 14.9% 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	2.0	2.4
Debtors’ Days	Days	510	451
Interest coverage	x	37.0	45.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	14.9	13.9
Return on equity	%	21.7	18.5
Return on capital employed	%	29.5	25.2

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 536.8 to Rs 740.5, registering a gain of Rs 203.7 or around 37.9%.

Overall, the S&P BSE SENSEX is up 1.8% over the year.

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