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MARICO 2021-22 Annual Report Analysis

Sun, 17 Jul

MARICO has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

MARICO Income Statement Analysis

• Operating income during the year rose 18.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 4.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.6% in FY22 as against 19.9% in FY21.
• Depreciation charges increased by 0.0% and finance costs increased by 14.7% YoY, respectively.
• Other income grew by 4.1% YoY.
• Net profit for the year grew by 4.5% YoY.
• Net profit margins during the year declined from 14.9% in FY21 to 13.2% in FY22.

MARICO Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	80,480	95,120	18.2%
Other income	Rs m	970	1,010	4.1%
Total Revenues	Rs m	81,450	96,130	18.0%
Gross profit	Rs m	16,010	16,780	4.8%
Depreciation	Rs m	1,390	1,390	0.0%
Interest	Rs m	340	390	14.7%
Profit before tax	Rs m	15,250	16,010	5.0%
Tax	Rs m	3,240	3,460	6.8%
Profit after tax	Rs m	12,010	12,550	4.5%
Gross profit margin	%	19.9	17.6
Effective tax rate	%	21.2	21.6
Net profit margin	%	14.9	13.2

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MARICO Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 22 billion as compared to Rs 20 billion in FY21, thereby witnessing an increase of 7.0%.
• Current assets rose 5% and stood at Rs 35 billion, while fixed assets rose 5% and stood at Rs 21 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 56 billion as against Rs 53 billion during FY21, thereby witnessing a growth of 5%.

MARICO Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	32,110	33,210	3.4
Current Liabilities	Rs m	20,130	21,530	7.0
Long-term Debt	Rs m	80	0	-100.0
Total Liabilities	Rs m	53,240	55,990	5.2
Current assets	Rs m	33,360	35,050	5.1
Fixed Assets	Rs m	19,880	20,940	5.3
Total Assets	Rs m	53,240	55,990	5.2

MARICO Cash Flow Statement Analysis

• MARICO's cash flow from operating activities (CFO) during FY22 stood at Rs 10 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs 4 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -13 billion on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 2 billion from the Rs 160 million net cash flows seen during FY21.

MARICO Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	20,070	10,160	-49.4%
Cash Flow from Investing Activities	Rs m	-9,380	4,280	-
Cash Flow from Financing Activities	Rs m	-10,580	-12,900	-
Net Cash Flow	Rs m	160	1,670	943.8%

Current Valuations for MARICO

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.7, an improvement from the EPS of Rs 9.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 506.5, stands at 52.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 19.7 times, while the price to sales ratio stands at 6.9 times.
• The company's price to cash flow (P/CF) ratio stood at 46.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	62.3	73.6
TTM Earnings per share	Rs	9.3	9.7
Diluted earnings per share	Rs	9.3	9.7
Price to Cash Flow	x	39.7	46.6
TTM P/E ratio	x	44.3	52.2
Price / Book Value ratio	x	14.0	19.6
Market Cap	Rs m	449,777	649,852
Dividends per share (Unadj.)	Rs	7.5	9.3

Ratio Analysis for MARICO

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.6x during FY22, from 1.7x during FY21. 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 42.1x during FY22, from 45.9x during FY21. 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 37.8% during FY22, from 37.4% during FY22. 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 49.4% during FY22, from 48.4% during FY21. 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 23.1% during FY22, from 23.2% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.7	1.6
Debtors’ Days	Days	2	3
Interest coverage	x	45.9	42.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	23.2	23.1
Return on equity	%	37.4	37.8
Return on capital employed	%	48.4	49.4

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 525.5 to Rs 506.5, registering a loss of Rs 19.1 or around 3.6%.

Meanwhile, the S&P BSE FMCG Index is trading at Rs 15,091.9 (up 1.5%). Over the last one year it has moved up from 13,593.0 to 15,091.9, a gain of 1,499 points (up 11.0%).

Overall, the S&P BSE SENSEX is up 1.6% over the year.

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

Read: Latest Annual Report Analysis of MARICO