NAVNEET EDUCATION 2022-23 Annual Report Analysis

Tue, 15 Aug

NAVNEET EDUCATION has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

NAVNEET EDUCATION Income Statement Analysis

• Operating income during the year rose 52.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 104.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 20.9% in FY23 as against 15.5% in FY22.
• Depreciation charges increased by 16.9% and finance costs increased by 82.4% YoY, respectively.
• Other income declined by 21.6% YoY.
• Net profit for the year grew by 174.1% YoY.
• Net profit margins during the year grew from 6.7% in FY22 to 12.0% in FY23.

NAVNEET EDUCATION Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	11,143	16,968	52.3%
Other income	Rs m	188	148	-21.6%
Total Revenues	Rs m	11,331	17,116	51.1%
Gross profit	Rs m	1,732	3,546	104.8%
Depreciation	Rs m	497	581	16.9%
Interest	Rs m	73	133	82.4%
Profit before tax	Rs m	1,350	2,980	120.7%
Tax	Rs m	607	942	55.3%
Profit after tax	Rs m	744	2,038	174.1%
Gross profit margin	%	15.5	20.9
Effective tax rate	%	44.9	31.6
Net profit margin	%	6.7	12.0

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NAVNEET EDUCATION Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 5 billion as compared to Rs 3 billion in FY22, thereby witnessing an increase of 61.0%.
• Current assets rose 33% and stood at Rs 11 billion, while fixed assets rose 26% and stood at Rs 6 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 17 billion as against Rs 13 billion during FY22, thereby witnessing a growth of 31%.

NAVNEET EDUCATION Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	9,479	11,503	21.4
Current Liabilities	Rs m	2,882	4,641	61.0
Long-term Debt	Rs m	2	0	-100.0
Total Liabilities	Rs m	12,691	16,565	30.5
Current assets	Rs m	7,913	10,545	33.3
Fixed Assets	Rs m	4,778	6,020	26.0
Total Assets	Rs m	12,691	16,565	30.5

NAVNEET EDUCATION Cash Flow Statement Analysis

• NAVNEET EDUCATION's cash flow from operating activities (CFO) during FY23 stood at Rs -216 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -860 million, an improvement of 256.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 1 billion, an improvement of 4,938% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -64 million from the Rs 29 million net cash flows seen during FY22.

NAVNEET EDUCATION Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	291	-216	-
Cash Flow from Investing Activities	Rs m	-241	-860	-
Cash Flow from Financing Activities	Rs m	-21	1,011	-
Net Cash Flow	Rs m	29	-64	-

Current Valuations for NAVNEET EDUCATION

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.0, an improvement from the EPS of Rs 3.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 145.2, stands at 15.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.9 times, while the price to sales ratio stands at 1.9 times.
• The company's price to cash flow (P/CF) ratio stood at 10.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	49.3	75.0
TTM Earnings per share	Rs	3.3	9.0
Diluted earnings per share	Rs	3.3	9.0
Price to Cash Flow	x	16.3	10.1
TTM P/E ratio	x	14.1	15.1
Price / Book Value ratio	x	2.3	2.3
Market Cap	Rs m	21,926	26,354
Dividends per share (Unadj.)	Rs	1.5	2.6

Ratio Analysis for NAVNEET EDUCATION

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.3x during FY23, from 2.7x during FY22. 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 23.4x during FY23, from 19.5x during FY22. 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 17.7% during FY23, from 7.8% during FY23. 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 27.1% during FY23, from 15.0% during FY22. 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 13.1% during FY23, from 6.4% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	2.7	2.3
Debtors’ Days	Days	793	713
Interest coverage	x	19.5	23.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.4	13.1
Return on equity	%	7.8	17.7
Return on capital employed	%	15.0	27.1

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

NAVNEET EDUCATION Share Price Performance

Over the last one year, NAVNEET EDUCATION share price has moved up from Rs 126.8 to Rs 145.2, registering a gain of Rs 18.4 or around 14.5%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 13,969.1 (up 0.6%). Over the last one year it has moved up from 13,819.7 to 13,969.1, a gain of 149 points (up 1.1%).

Overall, the S&P BSE SENSEX is up 10.2% over the year.

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