MENON BEARINGS 2022-23 Annual Report Analysis

Mon, 10 Jul

MENON BEARINGS 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.

MENON BEARINGS Income Statement Analysis

• Operating income during the year rose 11.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 25.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 24.1% in FY23 as against 21.4% in FY22.
• Depreciation charges increased by 2.2% and finance costs increased by 12.4% YoY, respectively.
• Other income grew by 1.8% YoY.
• Net profit for the year grew by 32.9% YoY.
• Net profit margins during the year grew from 12.4% in FY22 to 14.9% in FY23.

MENON BEARINGS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	1,975	2,194	11.1%
Other income	Rs m	5	5	1.8%
Total Revenues	Rs m	1,980	2,199	11.0%
Gross profit	Rs m	422	528	25.2%
Depreciation	Rs m	77	79	2.2%
Interest	Rs m	26	29	12.4%
Profit before tax	Rs m	324	425	31.4%
Tax	Rs m	78	99	26.7%
Profit after tax	Rs m	245	326	32.9%
Gross profit margin	%	21.4	24.1
Effective tax rate	%	24.2	23.3
Net profit margin	%	12.4	14.9

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MENON BEARINGS Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 308 million as compared to Rs 404 million in FY22, thereby witnessing an decrease of -23.9%.
• Long-term debt down at Rs 58 million as compared to Rs 66 million during FY22, a fall of 12.8%.
• Current assets rose 3% and stood at Rs 863 million, while fixed assets rose 9% and stood at Rs 872 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 2 billion as against Rs 2 billion during FY22, thereby witnessing a growth of 6%.

MENON BEARINGS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	1,120	1,333	19.1
Current Liabilities	Rs m	404	308	-23.9
Long-term Debt	Rs m	66	58	-12.8
Total Liabilities	Rs m	1,633	1,735	6.2
Current assets	Rs m	836	863	3.3
Fixed Assets	Rs m	798	872	9.3
Total Assets	Rs m	1,633	1,735	6.2

MENON BEARINGS Cash Flow Statement Analysis

• MENON BEARINGS's cash flow from operating activities (CFO) during FY23 stood at Rs 501 million, an improvement of 106.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -230 million, an improvement of 558.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -228 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 44 million from the Rs 10 million net cash flows seen during FY22.

MENON BEARINGS 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	242	501	106.8%
Cash Flow from Investing Activities	Rs m	-35	-230	-
Cash Flow from Financing Activities	Rs m	-197	-228	-
Net Cash Flow	Rs m	10	44	322.9%

Current Valuations for MENON BEARINGS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.8, an improvement from the EPS of Rs 4.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 143.2, stands at 24.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.0 times, while the price to sales ratio stands at 3.7 times.
• The company's price to cash flow (P/CF) ratio stood at 13.3 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	35.2	39.1
TTM Earnings per share	Rs	4.4	5.8
Diluted earnings per share	Rs	4.4	5.8
Price to Cash Flow	x	15.4	13.3
TTM P/E ratio	x	20.3	24.6
Price / Book Value ratio	x	4.1	4.0
Market Cap	Rs m	4,559	5,378
Dividends per share (Unadj.)	Rs	2.0	2.0

Ratio Analysis for MENON BEARINGS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.8x during FY23, from 2.1x 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 15.6x during FY23, from 13.5x 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 24.5% during FY23, from 21.9% 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 32.6% during FY23, from 29.5% 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 20.5% during FY23, from 16.6% 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	2.1	2.8
Debtors’ Days	Days	942	827
Interest coverage	x	13.5	15.6
Debt to equity ratio	x	0.1	0.0
Return on assets	%	16.6	20.5
Return on equity	%	21.9	24.5
Return on capital employed	%	29.5	32.6

To see how MENON BEARINGS has performed over the last 5 years, please visit here.

MENON BEARINGS Share Price Performance

Over the last one year, MENON BEARINGS share price has moved up from Rs 81.1 to Rs 143.2, registering a gain of Rs 62.1 or around 76.6%.

Overall, the S&P BSE SENSEX is up 23.0% over the year.

(To know more, check out historical annual results for MENON BEARINGS and quarterly results for MENON BEARINGS)