NALCO 2020-21 Annual Report Analysis

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NALCO 2020-21 Annual Report Analysis
Tue, 19 Oct

NALCO 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.

NALCO Income Statement Analysis

  • Operating income during the year rose 5.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 211.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 17.0% in FY21 as against 5.8% in FY20.
  • Depreciation charges increased by 14.3% and finance costs increased by 23.3% YoY, respectively.
  • Other income grew by 49.8% YoY.
  • Net profit for the year grew by 840.1% YoY.
  • Net profit margins during the year grew from 1.6% in FY20 to 13.9% in FY21.

NALCO Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 84,718 89,558 5.7%
Other income Rs m 2,739 4,103 49.8%
Total Revenues Rs m 87,458 93,661 7.1%
Gross profit Rs m 4,879 15,191 211.4%
Depreciation Rs m 5,298 6,058 14.3%
Interest Rs m 57 71 23.3%
Profit before tax Rs m 2,262 13,165 481.9%
Tax Rs m 880 170 -80.7%
Profit after tax Rs m 1,382 12,995 840.1%
Gross profit margin % 5.8 17.0
Effective tax rate % 38.9 1.3
Net profit margin % 1.6 13.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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NALCO Balance Sheet Analysis

  • The company's current liabilities during FY21 down at Rs 20 billion as compared to Rs 27 billion in FY20, thereby witnessing an decrease of -24.6%.
  • Current assets fell 6% and stood at Rs 43 billion, while fixed assets rose 4% and stood at Rs 104 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 147 billion as against Rs 145 billion during FY20, thereby witnessing a growth of 1%.

NALCO Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 99,865 106,790 6.9
 
Current Liabilities Rs m 27,200 20,498 -24.6
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 145,481 147,089 1.1
 
Current assets Rs m 45,578 43,063 -5.5
Fixed Assets Rs m 99,903 104,026 4.1
Total Assets Rs m 145,481 147,089 1.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



NALCO Cash Flow Statement Analysis

  • NALCO's cash flow from operating activities (CFO) during FY21 stood at Rs 22 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -14 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -6 billion, an improvement of 11% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 2 billion from the Rs -2 billion net cash flows seen during FY20.

NALCO 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 -3,486 21,990 -
Cash Flow from Investing Activities Rs m 8,727 -14,037 -
Cash Flow from Financing Activities Rs m -6,773 -6,002 -
Net Cash Flow Rs m -1,531 1,951 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for NALCO

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.1, an improvement from the EPS of Rs 0.7 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 116.9, stands at 13.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.8 times, while the price to sales ratio stands at 0.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 11.4 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 45.4 48.8
TTM Earnings per share Rs 0.7 7.1
Diluted earnings per share Rs 0.7 7.0
Price to Cash Flow x 32.6 11.4
TTM P/E ratio x 13.4 13.4
Price / Book Value ratio x 0.8 0.8
Market Cap Rs m 217,997 217,997
Dividends per share (Unadj.) Rs 2.8 3.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for NALCO

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 2.1x during FY21, from 1.7x 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 186.9x during FY21, from 40.4x 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 improved and stood at 12.2% during FY21, from 1.4% 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 improved and stood at 12.4% during FY21, from 2.3% 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 improved and stood at 8.9% during FY21, from 1.0% 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 1.7 2.1
Debtors’ Days Days 1 1
Interest coverage x 40.4 186.9
Debt to equity ratio x 0.0 0.0
Return on assets % 1.0 8.9
Return on equity % 1.4 12.2
Return on capital employed % 2.3 12.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

NALCO Share Price Performance

Over the last one year, NALCO share price has moved up from Rs 31.4 to Rs 116.9, registering a gain of Rs 85.5 or around 272.1%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 22,178.3 (down 1.1%). Over the last one year it has moved up from 8,345.3 to 22,178.3, a gain of 13,833 points (up 165.8%).

Overall, the S&P BSE SENSEX is up 52.0% over the year.

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

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Related Views on News

NALCO Announces Quarterly Results (1QFY22); Net Profit Up 1991.0% (Quarterly Result Update)

Aug 9, 2021 | Updated on Aug 9, 2021

For the quarter ended June 2021, NALCO has posted a net profit of Rs 3 bn (up 1991.0% YoY). Sales on the other hand came in at Rs 25 bn (up 79.2% YoY). Read on for a complete analysis of NALCO's quarterly results.

NALCO 2019-20 Annual Report Analysis (Annual Result Update)

Dec 8, 2020 | Updated on Dec 8, 2020

Here's an analysis of the annual report of NALCO for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of NALCO. Also includes updates on the valuation of NALCO.

NALCO Announces Quarterly Results (3QFY20); Net Profit Down 111.3% (Quarterly Result Update)

Feb 11, 2020 | Updated on Feb 11, 2020

For the quarter ended December 2019, NALCO has posted a net profit of Rs 340 m (down 111.3% YoY). Sales on the other hand came in at Rs 21 bn (down 23.2% YoY). Read on for a complete analysis of NALCO's quarterly results.

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