N C L IND. 2020-21 Annual Report Analysis

Wed, 31 Mar

N C L IND. 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.

N C L IND. Income Statement Analysis

• Operating income during the year rose 47.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 101.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.2% in FY21 as against 11.9% in FY20.
• Depreciation charges increased by 5.0% and finance costs decreased by 32.2% YoY, respectively.
• Other income grew by 143.8% YoY.
• Net profit for the year grew by 186.1% YoY.
• Net profit margins during the year grew from 4.3% in FY20 to 8.3% in FY21.

N C L IND. Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	11,843	17,492	47.7%
Other income	Rs m	33	80	143.8%
Total Revenues	Rs m	11,876	17,572	48.0%
Gross profit	Rs m	1,404	2,828	101.3%
Depreciation	Rs m	421	442	5.0%
Interest	Rs m	324	220	-32.2%
Profit before tax	Rs m	692	2,245	224.6%
Tax	Rs m	183	791	331.3%
Profit after tax	Rs m	508	1,454	186.1%
Gross profit margin	%	11.9	16.2
Effective tax rate	%	26.5	35.2
Net profit margin	%	4.3	8.3

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N C L IND. Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 4 billion as compared to Rs 4 billion in FY20, thereby witnessing an decrease of -2.9%.
• Long-term debt stood at Rs 2 billion as compared to Rs 2 billion during FY20, a growth of 43.1%.
• Current assets rose 12% and stood at Rs 4 billion, while fixed assets rose 18% and stood at Rs 10 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 14 billion as against Rs 12 billion during FY20, thereby witnessing a growth of 17%.

N C L IND. Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	5,284	6,647	25.8
Current Liabilities	Rs m	3,848	3,737	-2.9
Long-term Debt	Rs m	1,654	2,366	43.1
Total Liabilities	Rs m	11,720	13,658	16.5
Current assets	Rs m	3,634	4,079	12.2
Fixed Assets	Rs m	8,086	9,580	18.5
Total Assets	Rs m	11,720	13,658	16.5

N C L IND. Cash Flow Statement Analysis

• N C L IND.'s cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion, an improvement of 127.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -1 billion, an improvement of 73.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -524 million on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 522 million from the Rs -36 million net cash flows seen during FY20.

N C L IND. 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	1,058	2,406	127.3%
Cash Flow from Investing Activities	Rs m	-785	-1,360	-
Cash Flow from Financing Activities	Rs m	-310	-524	-
Net Cash Flow	Rs m	-36	522	-

Current Valuations for N C L IND.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 32.2, an improvement from the EPS of Rs 11.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 171.6, stands at 5.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.2 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 2.8 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	261.8	386.7
TTM Earnings per share	Rs	11.2	32.2
Diluted earnings per share	Rs	11.2	32.2
Price to Cash Flow	x	2.6	2.8
TTM P/E ratio	x	3.4	5.3
Price / Book Value ratio	x	0.9	0.8
Market Cap	Rs m	4,755	5,382
Dividends per share (Unadj.)	Rs	2.5	4.0

Ratio Analysis for N C L IND.

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY21, from 0.9x 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 11.2x during FY21, from 3.1x 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 21.9% during FY21, from 9.6% 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 27.4% during FY21, from 14.6% 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 12.3% during FY21, from 7.1% 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	0.9	1.1
Debtors’ Days	Days	442	217
Interest coverage	x	3.1	11.2
Debt to equity ratio	x	0.3	0.4
Return on assets	%	7.1	12.3
Return on equity	%	9.6	21.9
Return on capital employed	%	14.6	27.4

To see how N C L IND. has performed over the last 5 years, please visit here.

N C L IND. Share Price Performance

Over the last one year, N C L IND. share price has moved up from Rs 54.1 to Rs 171.6, registering a gain of Rs 117.5 or around 217.1%.

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

(To know more, check out historical annual results for N C L IND. and quarterly results for N C L IND.)

Read: Latest Annual Report Analysis of N C L IND.