L&T INFOTECH 2020-21 Annual Report Analysis

Wed, 31 Mar

L&T INFOTECH has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

L&T INFOTECH Income Statement Analysis

• Operating income during the year rose 13.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 34.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.9% in FY21 as against 18.6% in FY20.
• Depreciation charges increased by 21.8% and finance costs decreased by 4.6% YoY, respectively.
• Other income declined by 15.0% YoY.
• Net profit for the year grew by 27.5% YoY.
• Net profit margins during the year grew from 14.0% in FY20 to 15.7% in FY21.

L&T INFOTECH Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	108,786	123,698	13.7%
Other income	Rs m	3,381	2,875	-15.0%
Total Revenues	Rs m	112,167	126,573	12.8%
Gross profit	Rs m	20,203	27,120	34.2%
Depreciation	Rs m	2,729	3,325	21.8%
Interest	Rs m	826	788	-4.6%
Profit before tax	Rs m	20,029	25,882	29.2%
Tax	Rs m	4,824	6,500	34.7%
Profit after tax	Rs m	15,205	19,382	27.5%
Gross profit margin	%	18.6	21.9
Effective tax rate	%	24.1	25.1
Net profit margin	%	14.0	15.7

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L&T INFOTECH Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 26 billion as compared to Rs 23 billion in FY20, thereby witnessing an increase of 12.9%.
• Current assets rose 28% and stood at Rs 81 billion, while fixed assets rose 11% and stood at Rs 25 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 107 billion as against Rs 86 billion during FY20, thereby witnessing a growth of 24%.

L&T INFOTECH Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	53,357	72,528	35.9
Current Liabilities	Rs m	23,312	26,323	12.9
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	86,027	106,545	23.9
Current assets	Rs m	63,290	81,313	28.5
Fixed Assets	Rs m	22,737	25,232	11.0
Total Assets	Rs m	86,027	106,545	23.9

L&T INFOTECH Cash Flow Statement Analysis

• L&T INFOTECH's cash flow from operating activities (CFO) during FY21 stood at Rs 24 billion, an improvement of 46.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -17 billion, an improvement of 154.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -5 billion, an improvement of 43% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 2 billion from the Rs 1 billion net cash flows seen during FY20.

L&T INFOTECH Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	16,435	23,996	46.0%
Cash Flow from Investing Activities	Rs m	-6,520	-16,560	-
Cash Flow from Financing Activities	Rs m	-8,900	-5,088	-
Net Cash Flow	Rs m	1,102	2,342	112.5%

Current Valuations for L&T INFOTECH

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 110.9, an improvement from the EPS of Rs 87.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 4,048.0, stands at 36.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.8 times, while the price to sales ratio stands at 5.7 times.
• The company's price to cash flow (P/CF) ratio stood at 22.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	624.7	707.9
TTM Earnings per share	Rs	87.3	110.9
Diluted earnings per share	Rs	86.7	110.6
Price to Cash Flow	x	14.0	22.5
TTM P/E ratio	x	16.5	36.6
Price / Book Value ratio	x	5.3	7.0
Market Cap	Rs m	283,565	510,049
Dividends per share (Unadj.)	Rs	28.0	40.0

Ratio Analysis for L&T INFOTECH

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.1x during FY21, from 2.7x during FY20. 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 33.8x during FY21, from 25.2x during FY20. 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 26.7% during FY21, from 28.5% during FY21. 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 36.8% during FY21, from 39.1% during FY20. 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 18.9% during FY21, from 18.6% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	2.7	3.1
Debtors’ Days	Days	78	61
Interest coverage	x	25.2	33.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	18.6	18.9
Return on equity	%	28.5	26.7
Return on capital employed	%	39.1	36.8

To see how L&T INFOTECH has performed over the last 5 years, please visit here.

L&T INFOTECH Share Price Performance

Over the last one year, L&T INFOTECH share price has moved up from Rs 1,430.7 to Rs 4,048.0, registering a gain of Rs 2,617.4 or around 182.9%.

Meanwhile, the S&P BSE IT Index is trading at Rs 26,543.2 (down 0.7%). Over the last one year it has moved up from 12,842.7 to 26,543.2, a gain of 13,701 points (up 106.7%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

(To know more, check out historical annual results for L&T INFOTECH and quarterly results for L&T INFOTECH)

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