Markets will remain closed on April 17, 2024 on account of Ram Navami.

UNITED SPIRITS 2017-18 Annual Report Analysis

Sat, 31 Mar

UNITED SPIRITS 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.

UNITED SPIRITS Income Statement Analysis

• Operating income during the year rose 15.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 87.2% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 12.4% in FY18 as against 7.6% in FY17.
• Depreciation charges increased by 2.0% and finance costs decreased by 26.0% YoY, respectively.
• Other income grew by 107.9% YoY.
• Net profit for the year grew by 601.0% YoY.
• Net profit margins during the year declined from 1.1% in FY17 to 7.0% in FY18.

UNITED SPIRITS Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	-81,218	-93,747	15.4%
Other income	Rs m	1,053	2,189	107.9%
Total Revenues	Rs m	-80,165	-91,558	14.2%
Gross profit	Rs m	6,211	11,627	87.2%
Depreciation	Rs m	1,886	1,923	2.0%
Interest	Rs m	3,751	2,775	-26.0%
Profit before tax	Rs m	1,627	9,118	460.4%
Tax	Rs m	697	2,599	272.9%
Profit after tax	Rs m	930	6,519	601.0%
Gross profit margin	%	-7.6	-12.4
Effective tax rate	%	42.8	28.5
Net profit margin	%	-1.1	-7.0

For You: Midcap Stocks Research at Less than Its Launch Price

UNITED SPIRITS Balance Sheet Analysis

• The company's current liabilities during FY18 down at Rs 58 billion as compared to Rs 62 billion in FY17, thereby witnessing an decrease of -6.2%.
• Long-term debt down at Rs 8 billion as compared to Rs 9 billion during FY17, a fall of 12.3%.
• Current assets rose 1% and stood at Rs 58 billion, while fixed assets rose 4% and stood at Rs 31 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 89 billion as against Rs 87 billion during FY17, thereby witnessing a growth of 2%.

UNITED SPIRITS Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	17,856	24,191	35.5
Current Liabilities	Rs m	61,989	58,175	-6.2
Long-term Debt	Rs m	8,697	7,628	-12.3
Total Liabilities	Rs m	87,178	88,942	2.0
Current assets	Rs m	57,491	58,017	0.9
Fixed Assets	Rs m	29,687	30,925	4.2
Total Assets	Rs m	87,178	88,942	2.0

UNITED SPIRITS Cash Flow Statement Analysis

• UNITED SPIRITS's cash flow from operating activities (CFO) during FY18 stood at Rs 9 billion, an improvement of 43.0% 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 -10 billion on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 634 million from the Rs -502 million net cash flows seen during FY17.

UNITED SPIRITS Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	6,468	9,251	43.0%
Cash Flow from Investing Activities	Rs m	-2,273	1,044	-
Cash Flow from Financing Activities	Rs m	-4,697	-9,661	-
Net Cash Flow	Rs m	-502	634	-

Current Valuations for UNITED SPIRITS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 44.9, an improvement from the EPS of Rs 6.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,125.8, stands at 404.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 93.9 times, while the price to sales ratio stands at -4.8 times.
• The company's price to cash flow (P/CF) ratio stood at 50.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	-558.9	-645.1
TTM Earnings per share	Rs	6.4	44.9
Diluted earnings per share	Rs	1.3	9.0
Price to Cash Flow	x	560.8	50.2
TTM P/E ratio	x	353.4	404.4
Price / Book Value ratio	x	18.3	17.5
Market Cap	Rs m	327,311	423,972
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for UNITED SPIRITS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.0x during FY18, from 0.9x 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 improved and stood at 4.3x during FY18, from 1.4x 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 improved and stood at 26.9% during FY18, from 5.2% 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 37.4% during FY18, from 20.3% 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 10.4% during FY18, from 5.4% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	0.9	1.0
Debtors’ Days	Days	-133	-106
Interest coverage	x	1.4	4.3
Debt to equity ratio	x	0.5	0.3
Return on assets	%	5.4	10.4
Return on equity	%	5.2	26.9
Return on capital employed	%	20.3	37.4

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

UNITED SPIRITS Share Price Performance

Over the last one year, UNITED SPIRITS share price has moved up from Rs 2,173.5 to Rs 3,125.8, registering a gain of Rs 952.3 or around 43.8%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of UNITED SPIRITS