PIRAMAL ENTERPRISES 2021-22 Annual Report Analysis

Mon, 11 Jul

PIRAMAL ENTERPRISES 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.

PIRAMAL ENTERPRISES Income Statement Analysis

• Operating income during the year rose 9.2% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 16.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 44.9% in FY22 as against 58.7% in FY21.
• Depreciation charges increased by 18.7% and finance costs increased by 6.4% YoY, respectively.
• Other income grew by 98.0% YoY.
• Net profit for the year grew by 25.3% YoY.
• Net profit margins during the year grew from 8.4% in FY21 to 9.6% in FY22.

PIRAMAL ENTERPRISES Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	128,094	139,933	9.2%
Other income	Rs m	3,636	7,201	98.0%
Total Revenues	Rs m	131,730	147,134	11.7%
Gross profit	Rs m	75,231	62,822	-16.5%
Depreciation	Rs m	5,609	6,658	18.7%
Interest	Rs m	42,085	44,799	6.4%
Profit before tax	Rs m	31,173	18,567	-40.4%
Tax	Rs m	20,429	5,108	-75.0%
Profit after tax	Rs m	10,744	13,459	25.3%
Gross profit margin	%	58.7	44.9
Effective tax rate	%	65.5	27.5
Net profit margin	%	8.4	9.6

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PIRAMAL ENTERPRISES Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 196 billion as compared to Rs 139 billion in FY21, thereby witnessing an increase of 41.1%.
• Long-term debt stood at Rs 438 billion as compared to Rs 281 billion during FY21, a growth of 55.8%.
• Current assets rose 24% and stood at Rs 252 billion, while fixed assets rose 30% and stood at Rs 816 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 1,068 billion as against Rs 832 billion during FY21, thereby witnessing a growth of 28%.

PIRAMAL ENTERPRISES Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	340,180	354,891	4.3
Current Liabilities	Rs m	138,731	195,756	41.1
Long-term Debt	Rs m	280,968	437,784	55.8
Total Liabilities	Rs m	831,751	1,067,987	28.4
Current assets	Rs m	203,932	251,882	23.5
Fixed Assets	Rs m	627,818	816,105	30.0
Total Assets	Rs m	831,751	1,067,987	28.4

PIRAMAL ENTERPRISES Cash Flow Statement Analysis

• PIRAMAL ENTERPRISES's cash flow from operating activities (CFO) during FY22 stood at Rs 87 billion, an improvement of 138.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -22 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -70 billion on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 7 billion from the Rs 30 billion net cash flows seen during FY21.

PIRAMAL ENTERPRISES 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	36,645	87,496	138.8%
Cash Flow from Investing Activities	Rs m	-27,723	-22,262	-
Cash Flow from Financing Activities	Rs m	20,716	-69,880	-
Net Cash Flow	Rs m	29,701	7,000	-76.4%

Current Valuations for PIRAMAL ENTERPRISES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 56.4, an improvement from the EPS of Rs 47.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,709.7, stands at 30.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.1 times, while the price to sales ratio stands at 2.9 times.
• The company's price to cash flow (P/CF) ratio stood at 27.4 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	567.9	586.3
TTM Earnings per share	Rs	47.6	56.4
Diluted earnings per share	Rs	45.0	56.4
Price to Cash Flow	x	25.6	27.4
TTM P/E ratio	x	38.9	30.3
Price / Book Value ratio	x	0.9	1.6
Market Cap	Rs m	317,310	551,910
Dividends per share (Unadj.)	Rs	33.0	33.0

Ratio Analysis for PIRAMAL ENTERPRISES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY22, from 1.5x 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 1.4x during FY22, from 1.7x 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 3.8% during FY22, from 3.2% 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 declined and down at 8.0% during FY22, from 11.8% 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 5.5% during FY22, from 6.4% 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	1.5	1.3
Debtors’ Days	Days	4	4
Interest coverage	x	1.7	1.4
Debt to equity ratio	x	0.8	1.2
Return on assets	%	6.4	5.5
Return on equity	%	3.2	3.8
Return on capital employed	%	11.8	8.0

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

PIRAMAL ENTERPRISES Share Price Performance

Over the last one year, PIRAMAL ENTERPRISES share price has moved down from Rs 2,312.7 to Rs 1,709.7, registering a loss of Rs 603.0 or around 26.1%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 22,160.4 (up 0.4%). Over the last one year it has moved down from 25,875.4 to 22,160.4, a loss of 3,715 points (down 14.4%).

Overall, the S&P BSE SENSEX is up 3.1% over the year.

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

Read: Latest Annual Report Analysis of PIRAMAL ENTERPRISES