UNITED SPIRITS 2022-23 Annual Report Analysis

Sun, 9 Jul

UNITED SPIRITS has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

UNITED SPIRITS Income Statement Analysis

• Operating income during the year was NA on a year-on-year (YoY) basis.
• The company's operating profit increased by 10.5% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 24.0% in FY23 as against 12.3% in FY22.
• Depreciation charges decreased by 7.0% and finance costs increased by 18.1% YoY, respectively.
• Other income grew by 75.8% YoY.
• Net profit for the year grew by 38.9% YoY.
• Net profit margins during the year declined from 7.0% in FY22 to 17.1% in FY23.

UNITED SPIRITS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	-116,370	-65,922	NA
Other income	Rs m	484	851	75.8%
Total Revenues	Rs m	-115,886	-65,071	NA
Gross profit	Rs m	14,300	15,799	10.5%
Depreciation	Rs m	3,038	2,825	-7.0%
Interest	Rs m	880	1,039	18.1%
Profit before tax	Rs m	10,866	12,786	17.7%
Tax	Rs m	2,760	1,528	-44.6%
Profit after tax	Rs m	8,106	11,258	38.9%
Gross profit margin	%	-12.3	-24.0
Effective tax rate	%	25.4	12.0
Net profit margin	%	-7.0	-17.1

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UNITED SPIRITS Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 36 billion as compared to Rs 38 billion in FY22, thereby witnessing an decrease of -5.6%.
• Long-term debt down at Rs 3 million as compared to Rs 9 million during FY22, a fall of 66.7%.
• Current assets rose 21% and stood at Rs 62 billion, while fixed assets fell 6% and stood at Rs 34 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 96 billion as against Rs 88 billion during FY22, thereby witnessing a growth of 10%.

UNITED SPIRITS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	49,539	59,988	21.1
Current Liabilities	Rs m	38,383	36,243	-5.6
Long-term Debt	Rs m	9	3	-66.7
Total Liabilities	Rs m	87,635	96,042	9.6
Current assets	Rs m	51,634	62,346	20.7
Fixed Assets	Rs m	36,001	33,696	-6.4
Total Assets	Rs m	87,635	96,042	9.6

UNITED SPIRITS Cash Flow Statement Analysis

• UNITED SPIRITS's cash flow from operating activities (CFO) during FY23 stood at Rs 6 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -532 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -5 billion, an improvement of 27% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 606 million from the Rs -233 million net cash flows seen during FY22.

UNITED SPIRITS Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	9,774	6,147	-37.1%
Cash Flow from Investing Activities	Rs m	-3,127	-532	-
Cash Flow from Financing Activities	Rs m	-6,880	-5,009	-
Net Cash Flow	Rs m	-233	606	-

Current Valuations for UNITED SPIRITS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.5, an improvement from the EPS of Rs 11.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 914.9, stands at 59.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 11.1 times, while the price to sales ratio stands at -10.1 times.
• The company's price to cash flow (P/CF) ratio stood at 43.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	-160.1	-90.6
TTM Earnings per share	Rs	11.2	15.5
Diluted earnings per share	Rs	11.1	15.5
Price to Cash Flow	x	57.9	43.0
TTM P/E ratio	x	79.6	59.0
Price / Book Value ratio	x	11.2	10.1
Market Cap	Rs m	554,916	605,247
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 1.7x during FY23, from 1.3x during FY22. 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 13.3x during FY23, from 13.3x during FY22. 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 18.8% during FY23, from 16.4% during FY23. 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 23.0% during FY23, from 23.7% during FY22. 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 12.8% during FY23, from 10.3% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	1.3	1.7
Debtors’ Days	Days	-74	-135
Interest coverage	x	13.3	13.3
Debt to equity ratio	x	0.0	0.0
Return on assets	%	10.3	12.8
Return on equity	%	16.4	18.8
Return on capital employed	%	23.7	23.0

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 813.9 to Rs 914.9, registering a gain of Rs 101.1 or around 12.4%.

Overall, the S&P BSE SENSEX is up 22.9% over the year.

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