THE RAMCO CEMENTS 2022-23 Annual Report Analysis

Wed, 19 Jul

THE RAMCO CEMENTS 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.

THE RAMCO CEMENTS Income Statement Analysis

• Operating income during the year rose 36.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 8.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 20.1% in FY23 as against 29.9% in FY22.
• Depreciation charges increased by 25.8% and finance costs increased by 113.5% YoY, respectively.
• Other income grew by 17.6% YoY.
• Net profit for the year declined by 61.7% YoY.
• Net profit margins during the year declined from 20.7% in FY22 to 5.8% in FY23.

THE RAMCO CEMENTS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	43,228	59,040	36.6%
Other income	Rs m	280	329	17.6%
Total Revenues	Rs m	43,508	59,369	36.5%
Gross profit	Rs m	12,907	11,863	-8.1%
Depreciation	Rs m	4,022	5,060	25.8%
Interest	Rs m	1,130	2,412	113.5%
Profit before tax	Rs m	8,034	4,720	-41.3%
Tax	Rs m	-894	1,300	NA
Profit after tax	Rs m	8,929	3,420	-61.7%
Gross profit margin	%	29.9	20.1
Effective tax rate	%	-11.1	27.5
Net profit margin	%	20.7	5.8

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THE RAMCO CEMENTS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 31 billion as compared to Rs 29 billion in FY22, thereby witnessing an increase of 5.9%.
• Long-term debt stood at Rs 36 billion as compared to Rs 29 billion during FY22, a growth of 26.8%.
• Current assets rose 3% and stood at Rs 19 billion, while fixed assets rose 11% and stood at Rs 127 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 146 billion as against Rs 133 billion during FY22, thereby witnessing a growth of 10%.

THE RAMCO CEMENTS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	66,186	68,611	3.7
Current Liabilities	Rs m	29,377	31,111	5.9
Long-term Debt	Rs m	28,573	36,222	26.8
Total Liabilities	Rs m	133,125	146,153	9.8
Current assets	Rs m	18,624	19,099	2.5
Fixed Assets	Rs m	114,501	127,055	11.0
Total Assets	Rs m	133,125	146,153	9.8

THE RAMCO CEMENTS Cash Flow Statement Analysis

• THE RAMCO CEMENTS's cash flow from operating activities (CFO) during FY23 stood at Rs 14 billion, an improvement of 24.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -17 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 3 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -82 million from the Rs 347 million net cash flows seen during FY22.

THE RAMCO CEMENTS 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	11,349	14,115	24.4%
Cash Flow from Investing Activities	Rs m	-18,157	-16,941	-
Cash Flow from Financing Activities	Rs m	7,154	2,745	-61.6%
Net Cash Flow	Rs m	347	-82	-

Current Valuations for THE RAMCO CEMENTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 14.5, an decline from the EPS of Rs 37.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 923.7, stands at 63.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.2 times, while the price to sales ratio stands at 3.7 times.
• The company's price to cash flow (P/CF) ratio stood at 19.5 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	182.9	249.9
TTM Earnings per share	Rs	37.8	14.5
Diluted earnings per share	Rs	37.8	14.5
Price to Cash Flow	x	14.0	19.5
TTM P/E ratio	x	20.4	63.8
Price / Book Value ratio	x	3.3	2.4
Market Cap	Rs m	215,292	165,411
Dividends per share (Unadj.)	Rs	3.0	2.0

Ratio Analysis for THE RAMCO CEMENTS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.6x during FY23, from 0.6x 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 3.0x during FY23, from 8.1x 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 declined and down at 5.0% during FY23, from 13.5% 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 6.8% during FY23, from 9.7% 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 declined and down at 4.0% during FY23, from 7.6% 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	0.6	0.6
Debtors’ Days	Days	3	3
Interest coverage	x	8.1	3.0
Debt to equity ratio	x	0.4	0.5
Return on assets	%	7.6	4.0
Return on equity	%	13.5	5.0
Return on capital employed	%	9.7	6.8

To see how THE RAMCO CEMENTS has performed over the last 5 years, please visit here.

THE RAMCO CEMENTS Share Price Performance

Over the last one year, THE RAMCO CEMENTS share price has moved up from Rs 670.6 to Rs 923.7, registering a gain of Rs 253.1 or around 37.7%.

Overall, the S&P BSE SENSEX is up 22.6% over the year.

(To know more, check out historical annual results for THE RAMCO CEMENTS and quarterly results for THE RAMCO CEMENTS)