MARUTI SUZUKI 2019-20 Annual Report Analysis

Tue, 31 Mar

MARUTI SUZUKI has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

MARUTI SUZUKI Income Statement Analysis

• Operating income during the year fell 12.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 32.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 9.7% in FY20 as against 12.6% in FY19.
• Depreciation charges increased by 16.8% and finance costs increased by 76.8% YoY, respectively.
• Other income grew by 24.2% YoY.
• Net profit for the year declined by 25.8% YoY.
• Net profit margins during the year declined from 8.7% in FY19 to 7.3% in FY20.

MARUTI SUZUKI Income Statement 2019-20

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Net Sales	Rs m	860,685	756,600	-12.1%
Other income	Rs m	26,837	33,344	24.2%
Total Revenues	Rs m	887,522	789,944	-11.0%
Gross profit	Rs m	108,811	73,126	-32.8%
Depreciation	Rs m	30,208	35,284	16.8%
Interest	Rs m	759	1,342	76.8%
Profit before tax	Rs m	104,681	69,844	-33.3%
Tax	Rs m	29,732	14,252	-52.1%
Profit after tax	Rs m	74,949	55,592	-25.8%
Gross profit margin	%	12.6	9.7
Effective tax rate	%	28.4	20.4
Net profit margin	%	8.7	7.3

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MARUTI SUZUKI Balance Sheet Analysis

• The company's current liabilities during FY20 down at Rs 113 billion as compared to Rs 142 billion in FY19, thereby witnessing an decrease of -20.2%.
• Long-term debt down at Rs 54 million as compared to Rs 80 million during FY19, a fall of 32.5%.
• Current assets fell 32% and stood at Rs 84 billion, while fixed assets rose 7% and stood at Rs 552 billion in FY20.
• Overall, the total assets and liabilities for FY20 stood at Rs 636 billion as against Rs 640 billion during FY19, thereby witnessing a fall of 1%.

MARUTI SUZUKI Balance Sheet as on March 2020

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*	% Change
Networth	Rs m	470,921	494,130	4.9
Current Liabilities	Rs m	141,605	113,054	-20.2
Long-term Debt	Rs m	80	54	-32.5
Total Liabilities	Rs m	639,687	636,277	-0.5
Current assets	Rs m	123,727	84,406	-31.8
Fixed Assets	Rs m	515,960	551,871	7.0
Total Assets	Rs m	639,687	636,277	-0.5

MARUTI SUZUKI Cash Flow Statement Analysis

• MARUTI SUZUKI's cash flow from operating activities (CFO) during FY20 stood at Rs 35 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY20 stood at Rs -6 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY20 stood at Rs -31 billion on a YoY basis.
• Overall, net cash flows for the company during FY20 stood at Rs -2 billion from the Rs 1 billion net cash flows seen during FY19.

MARUTI SUZUKI Cash Flow Statement 2019-20

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-19	Mar-20
Cash Flow from Operating Activities	Rs m	66,009	34,958	-47.0%
Cash Flow from Investing Activities	Rs m	-35,399	-5,566	-
Cash Flow from Financing Activities	Rs m	-29,479	-31,043	-
Net Cash Flow	Rs m	1,131	-1,651	-

Current Valuations for MARUTI SUZUKI

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 184.0, an decline from the EPS of Rs 248.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 4,287.8, stands at 23.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.6 times, while the price to sales ratio stands at 1.7 times.
• The company's price to cash flow (P/CF) ratio stood at 19.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Sales per share (Unadj.)	Rs	2,849.2	2,504.6
TTM Earnings per share	Rs	248.1	184.0
Diluted earnings per share	Rs	248.1	184.0
Price to Cash Flow	x	19.2	19.6
TTM P/E ratio	x	26.9	23.3
Price / Book Value ratio	x	5.2	3.6
Market Cap	Rs m	2,453,948	1,781,366
Dividends per share (Unadj.)	Rs	80.0	60.0

Ratio Analysis for MARUTI SUZUKI

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.7x during FY20, from 0.9x during FY19. 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 53.0x during FY20, from 138.9x during FY19. 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 11.3% during FY20, from 15.9% during FY20. 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 14.4% during FY20, from 22.4% during FY19. 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 8.9% during FY20, from 11.8% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-19*	12 Mar-20*
Current ratio	x	0.9	0.7
Debtors’ Days	Days	10	10
Interest coverage	x	138.9	53.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.8	8.9
Return on equity	%	15.9	11.3
Return on capital employed	%	22.4	14.4

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

MARUTI SUZUKI Share Price Performance

Over the last one year, MARUTI SUZUKI share price has moved down from Rs 6,671.7 to Rs 4,287.8, registering a loss of Rs 2,384.0 or around 35.7%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 10,746.2 (up 1.3%). Over the last one year it has moved down from 18,824.9 to 10,746.2, a loss of 8,079 points (down 42.9%).

Overall, the S&P BSE SENSEX is down 24.2% over the year.

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

Read: Latest Annual Report Analysis of MARUTI SUZUKI