MPS 2021-22 Annual Report Analysis

Thu, 9 Jun

MPS 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.

MPS Income Statement Analysis

• Operating income during the year rose 6.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 18.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 28.0% in FY22 as against 25.2% in FY21.
• Depreciation charges decreased by 2.9% and finance costs decreased by 24.8% YoY, respectively.
• Other income grew by 41.9% YoY.
• Net profit for the year grew by 48.8% YoY.
• Net profit margins during the year grew from 13.9% in FY21 to 19.4% in FY22.

MPS Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	4,225	4,489	6.2%
Other income	Rs m	101	144	41.9%
Total Revenues	Rs m	4,327	4,633	7.1%
Gross profit	Rs m	1,065	1,257	18.0%
Depreciation	Rs m	212	206	-2.9%
Interest	Rs m	20	15	-24.8%
Profit before tax	Rs m	934	1,180	26.3%
Tax	Rs m	348	308	-11.5%
Profit after tax	Rs m	586	871	48.8%
Gross profit margin	%	25.2	28.0
Effective tax rate	%	37.3	26.1
Net profit margin	%	13.9	19.4

MPS Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 1 billion as compared to Rs 1 billion in FY21, thereby witnessing an increase of 4.0%.
• Current assets rose 8% and stood at Rs 3 billion, while fixed assets fell 10% and stood at Rs 4 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 7 billion as against Rs 7 billion during FY21, thereby witnessing a fall of 2%.

MPS Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	3,811	3,669	-3.7
Current Liabilities	Rs m	1,291	1,343	4.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	6,909	6,764	-2.1
Current assets	Rs m	2,969	3,214	8.2
Fixed Assets	Rs m	3,940	3,550	-9.9
Total Assets	Rs m	6,909	6,764	-2.1

MPS Cash Flow Statement Analysis

• MPS's cash flow from operating activities (CFO) during FY22 stood at Rs 1 billion, an improvement of 15.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs 154 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 150 million from the Rs -151 million net cash flows seen during FY21.

MPS 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	994	1,143	15.0%
Cash Flow from Investing Activities	Rs m	-593	154	-
Cash Flow from Financing Activities	Rs m	-529	-1,155	-
Net Cash Flow	Rs m	-151	150	-

Current Valuations for MPS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 50.9, an improvement from the EPS of Rs 32.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 723.4, stands at 14.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.4 times, while the price to sales ratio stands at 2.8 times.
• The company's price to cash flow (P/CF) ratio stood at 10.1 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	234.1	262.4
TTM Earnings per share	Rs	32.4	50.9
Diluted earnings per share	Rs	34.2	50.9
Price to Cash Flow	x	10.0	10.1
TTM P/E ratio	x	13.6	14.2
Price / Book Value ratio	x	1.8	3.0
Market Cap	Rs m	6,715	10,931
Dividends per share (Unadj.)	Rs	0.0	30.0

Ratio Analysis for MPS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.4x during FY22, from 2.3x 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 78.0x during FY22, from 46.8x 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 23.7% during FY22, from 15.4% 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 32.6% during FY22, from 25.0% 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 13.1% during FY22, from 8.8% 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	2.3	2.4
Debtors’ Days	Days	782	697
Interest coverage	x	46.8	78.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	8.8	13.1
Return on equity	%	15.4	23.7
Return on capital employed	%	25.0	32.6

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

MPS Share Price Performance

Over the last one year, MPS share price has moved up from Rs 561.1 to Rs 723.4, registering a gain of Rs 162.3 or around 28.9%.

Overall, the S&P BSE SENSEX is up 5.7% over the year.

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

Read: Latest Annual Report Analysis of MPS