INFO EDGE 2020-21 Annual Report Analysis

Wed, 31 Mar

INFO EDGE 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.

INFO EDGE Income Statement Analysis

• Operating income during the year fell 14.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 205.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 152.9% in FY21 as against 42.7% in FY20.
• Depreciation charges increased by 4.6% and finance costs decreased by 22.8% YoY, respectively.
• Other income grew by 43.0% YoY.
• Net profit for the year grew by 235.4% YoY.
• Net profit margins during the year grew from 36.8% in FY20 to 144.7% in FY21.

INFO EDGE Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	13,119	11,201	-14.6%
Other income	Rs m	1,045	1,494	43.0%
Total Revenues	Rs m	14,164	12,695	-10.4%
Gross profit	Rs m	5,606	17,126	205.5%
Depreciation	Rs m	477	499	4.6%
Interest	Rs m	141	109	-22.8%
Profit before tax	Rs m	6,033	18,012	198.6%
Tax	Rs m	1,200	1,805	50.4%
Profit after tax	Rs m	4,833	16,207	235.4%
Gross profit margin	%	42.7	152.9
Effective tax rate	%	19.9	10.0
Net profit margin	%	36.8	144.7

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INFO EDGE Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 7 billion as compared to Rs 6 billion in FY20, thereby witnessing an increase of 11.5%.
• Long-term debt down at Rs 1 million as compared to Rs 2 million during FY20, a fall of 70.2%.
• Current assets rose 106% and stood at Rs 31 billion, while fixed assets rose 90% and stood at Rs 41 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 73 billion as against Rs 37 billion during FY20, thereby witnessing a growth of 97%.

INFO EDGE Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	21,558	54,096	150.9
Current Liabilities	Rs m	6,394	7,128	11.5
Long-term Debt	Rs m	2	1	-70.2
Total Liabilities	Rs m	37,004	72,855	96.9
Current assets	Rs m	15,225	31,427	106.4
Fixed Assets	Rs m	21,779	41,428	90.2
Total Assets	Rs m	37,004	72,855	96.9

INFO EDGE Cash Flow Statement Analysis

• INFO EDGE's cash flow from operating activities (CFO) during FY21 stood at Rs 3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -20 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 19 billion, an improvement of 1,412% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 1 billion from the Rs 3 billion net cash flows seen during FY20.

INFO EDGE 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	3,502	2,757	-21.3%
Cash Flow from Investing Activities	Rs m	970	-20,429	-
Cash Flow from Financing Activities	Rs m	-1,434	18,804	-
Net Cash Flow	Rs m	3,038	1,131	-62.8%

Current Valuations for INFO EDGE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 126.1, an improvement from the EPS of Rs 39.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 4,276.3, stands at 34.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 10.2 times, while the price to sales ratio stands at 49.1 times.
• The company's price to cash flow (P/CF) ratio stood at 30.0 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	107.3	87.2
TTM Earnings per share	Rs	39.5	126.1
Diluted earnings per share	Rs	37.5	125.6
Price to Cash Flow	x	49.5	30.0
TTM P/E ratio	x	54.3	34.0
Price / Book Value ratio	x	13.3	9.3
Market Cap	Rs m	287,632	501,948
Dividends per share (Unadj.)	Rs	6.0	8.0

Ratio Analysis for INFO EDGE

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 4.4x during FY21, from 2.4x 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 166.8x during FY21, from 43.9x 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 30.0% during FY21, from 22.4% 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 33.5% during FY21, from 28.6% 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 22.4% during FY21, from 13.4% 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	2.4	4.4
Debtors’ Days	Days	3	2
Interest coverage	x	43.9	166.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.4	22.4
Return on equity	%	22.4	30.0
Return on capital employed	%	28.6	33.5

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

INFO EDGE Share Price Performance

Over the last one year, INFO EDGE share price has moved up from Rs 2,036.3 to Rs 4,276.3, registering a gain of Rs 2,240.0 or around 110.0%.

Meanwhile, the S&P BSE IT Index is trading at Rs 26,543.2 (down 0.7%). Over the last one year it has moved up from 12,842.7 to 26,543.2, a gain of 13,701 points (up 106.7%).

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

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

Read: Latest Annual Report Analysis of INFO EDGE