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MARICO 2019-20 Annual Report Analysis
Tue, 31 Mar

MARICO has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

MARICO Income Statement Analysis

  • Operating income during the year fell 0.3% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 8.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.6% in FY20 as against 18.1% in FY19.
  • Depreciation charges increased by 6.9% and finance costs increased by 25.0% YoY, respectively.
  • Other income grew by 23.3% YoY.
  • Net profit for the year declined by 7.9% YoY.
  • Net profit margins during the year declined from 15.4% in FY19 to 14.3% in FY20.

MARICO Income Statement 2019-20

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Net Sales Rs m 73,340 73,150 -0.3%
Other income Rs m 1,030 1,270 23.3%
Total Revenues Rs m 74,370 74,420 0.1%
Gross profit Rs m 13,260 14,370 8.4%
Depreciation Rs m 1,310 1,400 6.9%
Interest Rs m 400 500 25.0%
Profit before tax Rs m 12,580 13,740 9.2%
Tax Rs m 1,260 3,310 162.7%
Profit after tax Rs m 11,320 10,430 -7.9%
Gross profit margin % 18.1 19.6
Effective tax rate % 10.0 24.1
Net profit margin % 15.4 14.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

MARICO Balance Sheet Analysis

  • The company's current liabilities during FY20 stood at Rs 18 billion as compared to Rs 17 billion in FY19, thereby witnessing an increase of 1.7%.
  • Long-term debt down at Rs 100 million as compared to Rs 140 million during FY19, a fall of 28.6%.
  • Current assets fell 2% and stood at Rs 31 billion, while fixed assets rose 10% and stood at Rs 17 billion in FY20.
  • Overall, the total assets and liabilities for FY20 stood at Rs 48 billion as against Rs 47 billion during FY19, thereby witnessing a growth of 2%.

MARICO Balance Sheet as on March 2020

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Networth Rs m 29,570 29,980 1.4
 
Current Liabilities Rs m 17,240 17,530 1.7
Long-term Debt Rs m 140 100 -28.6
Total Liabilities Rs m 47,080 48,110 2.2
 
Current assets Rs m 32,000 31,490 -1.6
Fixed Assets Rs m 15,080 16,620 10.2
Total Assets Rs m 47,080 48,110 2.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



MARICO Cash Flow Statement Analysis

  • MARICO's cash flow from operating activities (CFO) during FY20 stood at Rs 12 billion, an improvement of 14.3% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY20 stood at Rs -390 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY20 stood at Rs -11 billion on a YoY basis.
  • Overall, net cash flows for the company during FY20 stood at Rs 450 million from the Rs -30 million net cash flows seen during FY19.

MARICO Cash Flow Statement 2019-20

Particulars No. of months 12 12 % Change
Year Ending Mar-19 Mar-20
Cash Flow from Operating Activities Rs m 10,620 12,140 14.3%
Cash Flow from Investing Activities Rs m -3,340 -390 -
Cash Flow from Financing Activities Rs m -6,980 -11,470 -
Net Cash Flow Rs m -30 450 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for MARICO

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.1, an decline from the EPS of Rs 8.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 274.9, stands at 34.1 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 11.9 times, while the price to sales ratio stands at 4.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 34.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Sales per share (Unadj.) Rs 56.8 56.7
TTM Earnings per share Rs 8.8 8.1
Diluted earnings per share Rs 8.8 8.1
Price to Cash Flow x 35.3 34.8
TTM P/E ratio x 39.3 34.1
Price / Book Value ratio x 15.3 13.7
Market Cap Rs m 452,835 411,512
Dividends per share (Unadj.) Rs 4.8 6.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for MARICO

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY20, from 1.9x during FY19. 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 28.5x during FY20, from 32.5x during FY19. 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 34.8% during FY20, from 38.3% during FY20. 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 47.3% during FY20, from 43.7% during FY19. 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 22.7% during FY20, from 24.9% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Current ratio x 1.9 1.8
Debtors’ Days Days 3 3
Interest coverage x 32.5 28.5
Debt to equity ratio x 0.0 0.0
Return on assets % 24.9 22.7
Return on equity % 38.3 34.8
Return on capital employed % 43.7 47.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

MARICO Share Price Performance

Over the last one year, MARICO share price has moved down from Rs 345.3 to Rs 274.9, registering a loss of Rs 70.4 or around 20.4%.

Meanwhile, the S&P BSE FMCG Index is trading at Rs 10,254.9 (up 5.8%). Over the last one year it has moved down from 11,741.5 to 10,254.9, a loss of 1,487 points (down 12.7%).

Overall, the S&P BSE SENSEX is down 24.2% over the year.

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

Annual Report FAQs

What is the current share price of MARICO?

MARICO currently trades at Rs 496.9 per share. You can check out the latest share price performance of MARICO here...

What was the revenue of MARICO in FY20? How does it compare to earlier years?

The revenues of MARICO stood at Rs 74,420 m in FY20, which was up 0.1% compared to Rs 74,370 m reported in FY19.

MARICO's revenue has grown from Rs 61,043 m in FY16 to Rs 74,420 m in FY20.

Over the past 5 years, the revenue of MARICO has grown at a CAGR of 5.1%.

What was the net profit of MARICO in FY20? How does it compare to earlier years?

The net profit of MARICO stood at Rs 10,430 m in FY20, which was down -7.9% compared to Rs 11,320 m reported in FY19.

This compares to a net profit of Rs 8,270 m in FY18 and a net profit of Rs 8,120 m in FY17.

Over the past 5 years, MARICO net profit has grown at a CAGR of 9.6%.

What does the cash flow statement of MARICO reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of MARICO reveals:

  • Cash flow from operations increased in FY20 and stood at Rs 12,140 m as compared to Rs 10,620 m in FY19.
  • Cash flow from investments increased in FY20 and stood at Rs -390 m as compared to Rs -3,340 m in FY19.
  • Cash flow from financial activity decreased in FY20 and stood at Rs -11,470 m as compared to Rs -6,980 m in FY19.

Here's the cash flow statement of MARICO for the past 5 years.

(Rs m)FY16FY17FY18FY19FY20
From Operations8,1766,4875,16010,62012,140
From Investments-1,969-915550-3,340-390
From Financial Activity-6,010-5,740-5,670-6,980-11,470
Net Cashflow141-50580-30450

What does the Key Ratio analysis of MARICO reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of MARICO reveals:

  • Operating profit margins witnessed a fall and down at 19.6% in FY20 as against 18.1% in FY19.
  • Net profit margins declined from 15.4% in FY19 to 14.3% in FY20.
  • Debt to Equity ratio for FY20 stood at 0.0 as compared to 0.0 in FY19.

Here's the ratio/financial analysis of MARICO for the past 5 years.

 FY16FY17FY18FY19FY20
Operating Profit Margin (%)17.419.618.018.119.6
Net Profit Margin (%)12.013.813.115.414.3
Debt to Equity Ratio (x)0.00.00.00.00.0

Read: Latest Annual Report Analysis of MARICO

 

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