CERA SANITARY 2020-21 Annual Report Analysis

Wed, 31 Mar

CERA SANITARY has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

CERA SANITARY Income Statement Analysis

• Operating income during the year rose 0.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 4.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 12.9% in FY21 as against 13.5% in FY20.
• Depreciation charges increased by 2.1% and finance costs decreased by 3.2% YoY, respectively.
• Other income grew by 38.1% YoY.
• Net profit for the year declined by 9.6% YoY.
• Net profit margins during the year declined from 9.0% in FY20 to 8.2% in FY21.

CERA SANITARY Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	12,237	12,243	0.1%
Other income	Rs m	182	252	38.1%
Total Revenues	Rs m	12,419	12,495	0.6%
Gross profit	Rs m	1,655	1,581	-4.5%
Depreciation	Rs m	388	396	2.1%
Interest	Rs m	101	97	-3.2%
Profit before tax	Rs m	1,349	1,339	-0.7%
Tax	Rs m	243	340	39.7%
Profit after tax	Rs m	1,105	999	-9.6%
Gross profit margin	%	13.5	12.9
Effective tax rate	%	18.0	25.4
Net profit margin	%	9.0	8.2

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CERA SANITARY Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 4 billion as compared to Rs 3 billion in FY20, thereby witnessing an increase of 17.7%.
• Long-term debt down at Rs 426 million as compared to Rs 434 million during FY20, a fall of 1.9%.
• Current assets rose 25% and stood at Rs 9 billion, while fixed assets fell 4% and stood at Rs 5 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 14 billion as against Rs 12 billion during FY20, thereby witnessing a growth of 13%.

CERA SANITARY Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	7,707	8,717	13.1
Current Liabilities	Rs m	3,165	3,725	17.7
Long-term Debt	Rs m	434	426	-1.9
Total Liabilities	Rs m	12,194	13,777	13.0
Current assets	Rs m	7,205	9,000	24.9
Fixed Assets	Rs m	4,989	4,777	-4.2
Total Assets	Rs m	12,194	13,777	13.0

CERA SANITARY Cash Flow Statement Analysis

• CERA SANITARY's cash flow from operating activities (CFO) during FY21 stood at Rs 3 billion, an improvement of 107.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -2 billion, an improvement of 204.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -188 million, an improvement of 66% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 68 million from the Rs -58 million net cash flows seen during FY20.

CERA SANITARY Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	1,290	2,680	107.7%
Cash Flow from Investing Activities	Rs m	-797	-2,423	-
Cash Flow from Financing Activities	Rs m	-552	-188	-
Net Cash Flow	Rs m	-58	68	-

Current Valuations for CERA SANITARY

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 76.8, an decline from the EPS of Rs 85.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,904.4, stands at 50.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.8 times, while the price to sales ratio stands at 4.1 times.
• The company's price to cash flow (P/CF) ratio stood at 29.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	940.6	941.1
TTM Earnings per share	Rs	85.0	76.8
Diluted earnings per share	Rs	85.0	76.8
Price to Cash Flow	x	20.1	29.1
TTM P/E ratio	x	27.2	50.8
Price / Book Value ratio	x	4.3	4.7
Market Cap	Rs m	33,040	40,653
Dividends per share (Unadj.)	Rs	13.0	13.0

Ratio Analysis for CERA SANITARY

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.4x during FY21, from 2.3x during FY20. 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 14.8x during FY21, from 14.4x during FY20. 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 11.5% during FY21, from 14.3% during FY21. 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 15.7% during FY21, from 17.8% during FY20. 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 8.0% during FY21, from 9.9% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	2.3	2.4
Debtors’ Days	Days	665	624
Interest coverage	x	14.4	14.8
Debt to equity ratio	x	0.1	0.0
Return on assets	%	9.9	8.0
Return on equity	%	14.3	11.5
Return on capital employed	%	17.8	15.7

To see how CERA SANITARY has performed over the last 5 years, please visit here.

CERA SANITARY Share Price Performance

Over the last one year, CERA SANITARY share price has moved up from Rs 2,308.1 to Rs 3,904.4, registering a gain of Rs 1,596.3 or around 69.2%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

(To know more, check out historical annual results for CERA SANITARY and quarterly results for CERA SANITARY)

Read: Latest Annual Report Analysis of CERA SANITARY