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MAX FINANCIAL SERVICES LTD 2017-18 Annual Report Analysis

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MAX FINANCIAL SERVICES LTD 2017-18 Annual Report Analysis
Fri, 28 Sep

MAX FINANCIAL SERVICES LTD has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

MAX FINANCIAL SERVICES LTD Income Statement Analysis

  • Operating income during the year rose 10.9% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 89.9% YoY during the fiscal. Operating profit margins witnessed a rise and up at 3.7% in FY18 as against 2.2% in FY17.
  • Depreciation charges and finance costs increased by 38.0% YoY and 48.6% YoY, respectively.
  • Other income grew by 84.2% YoY.
  • Net profit for the year grew by 19.2% YoY.
  • Net profit margins during the year declined from 3.7% in FY17 to 4.0% in FY18.

MAX FINANCIAL SERVICES LTD Income Statement 2017-18

No. of Mths Year Ending12 Mar-17*12 Mar-18*% Change
Net SalesRs m14,16115,70910.9%
Other incomeRs m24444984.2%
Total RevenuesRs m14,40416,15812.2%
Gross profitRs m30958689.9%
DepreciationRs m53273538.0%
InterestRs m52778348.6%
Profit before taxRs m-507-483-4.8%
TaxRs m33160392.6%
Profit after taxRs m-540-64319.2%
Gross profit margin%2.23.7
Effective tax rate%-6.4-33.2
Net profit margin%-3.7-4.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



MAX FINANCIAL SERVICES LTD Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 8 billion as compared to Rs 8 billion in FY17, thereby witnessing an increase of 6.0%.
  • Long-term debt stood at Rs 6 billion as compared to Rs 5 billion during FY17, a growth of 19.9%.
  • Current assets fell 8% and stood at Rs 8 billion, while fixed assets rose 5% and stood at Rs 10 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 32 billion as against Rs 29 billion during FY17, thereby witnessing a growth of 8%.

MAX FINANCIAL SERVICES LTD Balance Sheet as on March 2018

No. of Mths Year Ending12 Mar-17*12 Mar-18*% Change
NetworthRs m12,67412,049-4.9
 
Current LiabilitiesRs m7,9768,4556.0
Long-term DebtRs m5,2466,28819.9
Total LiabilitiesRs m29,22031,6658.4
 
Current assetsRs m8,1547,507-7.9
Fixed AssetsRs m 9,77910,3015.3
Total AssetsRs m29,22031,6658.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



MAX FINANCIAL SERVICES LTD Cash Flow Statement Analysis

  • MAX FINANCIAL SERVICES LTD's cash flow from operating activities (CFO) during FY18 stood at Rs 453 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -1 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs 646 million on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 4 million from the Rs 131 million net cash flows seen during FY17.

MAX FINANCIAL SERVICES LTD Cash Flow Statement 2017-18

ParticularsNo. of months1212% Change
Year EndingMar-17Mar-18
Cash Flow from Operating ActivitiesRs m778453-41.8%
Cash Flow from Investing ActivitiesRs m-3,794-1,096-
Cash Flow from Financing ActivitiesRs m3,146646-79.5%
Net Cash FlowRs m1314-97.0%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for MAX FINANCIAL SERVICES LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs -2.4, an decline from the EPS of Rs -2.0 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 415.0, stands at -692.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.9 times, while the price to sales ratio stands at 2.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 1,203.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending12 Mar-17*12 Mar-18*
Sales per share (Unadj.)Rs53.058.5
TTM Earnings per shareRs-2.0-2.4
Diluted earnings per shareRs-2.0-2.4
Price to Cash Flow x-15,620.21,203.3
TTM P/E ratiox-694.0-692.0
Price / Book Value ratiox3.42.9
Market CapRs m110,904110,580
Dividends per share (Unadj.)Rs0.00.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for MAX FINANCIAL SERVICES LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 0.9x during FY18, from 1.0x during FY17. 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 0.4x during FY18, from 0.0x during FY17. 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 -5.3% during FY18, from -4.3% during FY18. 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 1.6% during FY18, from 0.1% during FY17. 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 0.4% during FY18, from 0.0% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending12 Mar-17*12 Mar-18*
Current ratiox1.00.9
Debtors’ DaysDays3448
Interest coveragex0.00.4
Debt to equity ratiox0.40.5
Return on assets%0.00.4
Return on equity%-4.3-5.3
Return on capital employed%0.11.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how MAX FINANCIAL SERVICES LTD has performed over the last 5 years, please visit here.

MAX FINANCIAL SERVICES LTD Share Price Performance

Over the last one year, MAX FINANCIAL SERVICES LTD share price has moved down from Rs 583.8 to Rs 415.0, registering a loss of Rs 168.9 or around 28.9%.

Overall, the S&P BSE SENSEX is up 16.4% over the year.

(To know more, check out historical annual results for MAX FINANCIAL SERVICES LTD and quarterly results for MAX FINANCIAL SERVICES LTD)

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