MINDTREE LTD 2017-18 Annual Report Analysis

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MINDTREE LTD 2017-18 Annual Report Analysis
Tue, 21 Aug

MINDTREE 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.

MINDTREE LTD Income Statement Analysis

  • Operating income during the year rose 4.3% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 5.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.6% in FY18 as against 13.5% in FY17.
  • Depreciation charges and finance costs decreased by 7.7% YoY and 11.5% YoY, respectively.
  • Other income grew by 243.9% YoY.
  • Net profit for the year grew by 36.2% YoY.
  • Net profit margins during the year grew from 7.9% in FY17 to 10.1% in FY18.

MINDTREE LTD Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 52,364 54,628 4.3%
Other income Rs m 553 1,902 243.9%
Total Revenues Rs m 52,917 56,530 6.8%
Gross profit Rs m 7,045 7,405 5.1%
Depreciation Rs m 1,858 1,715 -7.7%
Interest Rs m 191 169 -11.5%
Profit before tax Rs m 5,549 7,423 33.8%
Tax Rs m 1,363 1,722 26.3%
Profit after tax Rs m 4,186 5,701 36.2%
Gross profit margin % 13.5 13.6
Effective tax rate % 24.6 23.2
Net profit margin % 7.9 10.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



MINDTREE LTD Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 10 billion as compared to Rs 8 billion in FY17, thereby witnessing an increase of 26.0%.
  • Long-term debt down at Rs 9 million as compared to Rs 13 million during FY17, a fall of 30.8%.
  • Current assets rose 21% and stood at Rs 25 billion, while fixed assets fell 7% and stood at Rs 10 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 37 billion as against Rs 34 billion during FY17, thereby witnessing a growth of 10%.

MINDTREE LTD Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 25,771 27,414 6.4
 
Current Liabilities Rs m 7,821 9,857 26.0
Long-term Debt Rs m 13 9 -30.8
Total Liabilities Rs m 33,906 37,365 10.2
 
Current assets Rs m 20,610 25,031 21.5
Fixed Assets Rs m 10,412 9,660 -7.2
Total Assets Rs m 33,906 37,365 10.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



MINDTREE LTD Cash Flow Statement Analysis

  • MINDTREE LTD's cash flow from operating activities (CFO) during FY18 stood at Rs 6 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -2 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -3 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 767 million from the Rs 571 million net cash flows seen during FY17.

MINDTREE LTD 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 6,535 5,644 -13.6%
Cash Flow from Investing Activities Rs m -4,533 -2,000 -
Cash Flow from Financing Activities Rs m -1,376 -2,875 -
Net Cash Flow Rs m 571 767 34.3%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for MINDTREE LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 34.8, an improvement from the EPS of Rs 24.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,036.3, stands at 31.1 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.9 times, while the price to sales ratio stands at 2.0 times.
  • The company's price to cash flow (P/CF) ratio stood at 23.9 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 311.6 333.2
TTM Earnings per share Rs 24.9 34.8
Diluted earnings per share Rs 24.5 33.3
Price to Cash Flow x 28.8 23.9
TTM P/E ratio x 30.5 31.1
Price / Book Value ratio x 3.8 3.9
Market Cap Rs m 174,129 177,373
Dividends per share (Unadj.) Rs 10.0 9.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for MINDTREE LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 2.5x during FY18, from 2.6x 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 44.9x during FY18, from 30.1x 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 20.8% during FY18, from 16.2% 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 27.7% during FY18, from 22.3% 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 15.7% during FY18, from 12.9% 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 2.6 2.5
Debtors’ Days Days 62 68
Interest coverage x 30.1 44.9
Debt to equity ratio x 0.0 0.0
Return on assets % 12.9 15.7
Return on equity % 16.2 20.8
Return on capital employed % 22.3 27.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

MINDTREE LTD Share Price Performance

Over the last one year, MINDTREE LTD share price has moved up from Rs 461.6 to Rs 1,036.3, registering a gain of Rs 574.8 or around 124.5%.

Meanwhile, the S&P BSE IT Index is trading at Rs 14,956.8 (up 0.4%). Over the last one year it has moved up from 9,875.8 to 14,956.8, a gain of 5,081 points (up 51.4%).

Overall, the S&P BSE SENSEX is up 22.4% over the year.

(To know more, check out historical annual results for MINDTREE LTD and quarterly results for MINDTREE LTD)

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For the quarter ended March 2020, MINDTREE has posted a net profit of Rs 2 bn (up 3.9% YoY). Sales on the other hand came in at Rs 21 bn (up 11.5% YoY). Read on for a complete analysis of MINDTREE's quarterly results.

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Here's an analysis of the annual report of MINDTREE for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of MINDTREE. Also includes updates on the valuation of MINDTREE.

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