MAHANAGAR GAS 2022-23 Annual Report Analysis

Sun, 6 Aug

MAHANAGAR GAS 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.

MAHANAGAR GAS Income Statement Analysis

• Operating income during the year rose 75.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 28.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 20.9% in FY23 as against 28.5% in FY22.
• Depreciation charges increased by 17.8% and finance costs increased by 24.7% YoY, respectively.
• Other income grew by 29.0% YoY.
• Net profit for the year grew by 32.3% YoY.
• Net profit margins during the year declined from 18.5% in FY22 to 13.9% in FY23.

MAHANAGAR GAS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	32,355	56,776	75.5%
Other income	Rs m	868	1,120	29.0%
Total Revenues	Rs m	33,223	57,896	74.3%
Gross profit	Rs m	9,233	11,841	28.3%
Depreciation	Rs m	1,963	2,311	17.8%
Interest	Rs m	75	94	24.7%
Profit before tax	Rs m	8,063	10,555	30.9%
Tax	Rs m	2,093	2,655	26.8%
Profit after tax	Rs m	5,970	7,901	32.3%
Gross profit margin	%	28.5	20.9
Effective tax rate	%	26.0	25.2
Net profit margin	%	18.5	13.9

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MAHANAGAR GAS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 16 billion as compared to Rs 13 billion in FY22, thereby witnessing an increase of 17.7%.
• Current assets rose 9% and stood at Rs 20 billion, while fixed assets rose 19% and stood at Rs 40 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 60 billion as against Rs 52 billion during FY22, thereby witnessing a growth of 15%.

MAHANAGAR GAS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	35,973	41,342	14.9
Current Liabilities	Rs m	13,266	15,612	17.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	52,338	60,323	15.3
Current assets	Rs m	18,451	20,062	8.7
Fixed Assets	Rs m	33,887	40,261	18.8
Total Assets	Rs m	52,338	60,323	15.3

MAHANAGAR GAS Cash Flow Statement Analysis

• MAHANAGAR GAS's cash flow from operating activities (CFO) during FY23 stood at Rs 10 billion, an improvement of 7.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -6 billion, an improvement of 20.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -3 billion, an improvement of 8% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 354 million from the Rs 543 million net cash flows seen during FY22.

MAHANAGAR GAS 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	9,037	9,693	7.3%
Cash Flow from Investing Activities	Rs m	-5,391	-6,491	-
Cash Flow from Financing Activities	Rs m	-3,103	-2,848	-
Net Cash Flow	Rs m	543	354	-34.8%

Current Valuations for MAHANAGAR GAS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 80.0, an improvement from the EPS of Rs 60.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,056.3, stands at 10.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.5 times, while the price to sales ratio stands at 1.8 times.
• The company's price to cash flow (P/CF) ratio stood at 8.1 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	327.5	574.8
TTM Earnings per share	Rs	60.4	80.0
Diluted earnings per share	Rs	60.4	80.0
Price to Cash Flow	x	9.7	8.1
TTM P/E ratio	x	12.9	10.7
Price / Book Value ratio	x	2.7	2.0
Market Cap	Rs m	97,032	82,645
Dividends per share (Unadj.)	Rs	25.0	26.0

Ratio Analysis for MAHANAGAR GAS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY23, from 1.4x 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 improved and stood at 113.4x during FY23, from 108.1x 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 improved and stood at 19.1% during FY23, from 16.6% 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 improved and stood at 25.8% during FY23, from 22.6% 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 13.3% during FY23, from 11.5% 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	1.4	1.3
Debtors’ Days	Days	2	2
Interest coverage	x	108.1	113.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.5	13.3
Return on equity	%	16.6	19.1
Return on capital employed	%	22.6	25.8

To see how MAHANAGAR GAS has performed over the last 5 years, please visit here.

MAHANAGAR GAS Share Price Performance

Over the last one year, MAHANAGAR GAS share price has moved up from Rs 789.8 to Rs 1,056.3, registering a gain of Rs 266.5 or around 33.7%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 18,909.6 (down 0.1%). Over the last one year it has moved down from 19,336.6 to 18,909.6, a loss of 427 points (down 2.2%).

Overall, the S&P BSE SENSEX is up 12.6% over the year.

(To know more, check out historical annual results for MAHANAGAR GAS and quarterly results for MAHANAGAR GAS)