NECTAR LIFESCIENCE 2022-23 Annual Report Analysis

Tue, 20 Feb

NECTAR LIFESCIENCE 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.

NECTAR LIFESCIENCE Income Statement Analysis

• Operating income during the year fell 7.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 66.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 4.1% in FY23 as against 11.2% in FY22.
• Depreciation charges increased by 3.8% and finance costs increased by 0.9% YoY, respectively.
• Other income grew by 281.5% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year declined from 1.8% in FY22 to 1.9% in FY23.

NECTAR LIFESCIENCE Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	14,121	13,008	-7.9%
Other income	Rs m	113	432	281.5%
Total Revenues	Rs m	14,235	13,440	-5.6%
Gross profit	Rs m	1,585	530	-66.6%
Depreciation	Rs m	570	591	3.8%
Interest	Rs m	788	795	0.9%
Profit before tax	Rs m	341	-424	NA
Tax	Rs m	90	-182	NA
Profit after tax	Rs m	250	-242	NA
Gross profit margin	%	11.2	4.1
Effective tax rate	%	26.5	43.0
Net profit margin	%	1.8	-1.9

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NECTAR LIFESCIENCE Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 9 billion as compared to Rs 10 billion in FY22, thereby witnessing an decrease of -11.2%.
• Long-term debt down at Rs 2 billion as compared to Rs 3 billion during FY22, a fall of 22.2%.
• Current assets fell 9% and stood at Rs 12 billion, while fixed assets fell 9% and stood at Rs 9 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 22 billion as against Rs 24 billion during FY22, thereby witnessing a fall of 9%.

NECTAR LIFESCIENCE Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	10,879	10,646	-2.1
Current Liabilities	Rs m	10,038	8,909	-11.2
Long-term Debt	Rs m	2,911	2,265	-22.2
Total Liabilities	Rs m	23,880	21,686	-9.2
Current assets	Rs m	13,549	12,312	-9.1
Fixed Assets	Rs m	10,332	9,375	-9.3
Total Assets	Rs m	23,880	21,686	-9.2

NECTAR LIFESCIENCE Cash Flow Statement Analysis

• NECTAR LIFESCIENCE's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 40.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 517 million, an improvement of 210.6% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -2 million from the Rs -77 million net cash flows seen during FY22.

NECTAR LIFESCIENCE 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	950	1,337	40.7%
Cash Flow from Investing Activities	Rs m	166	517	210.6%
Cash Flow from Financing Activities	Rs m	-1,194	-1,856	-
Net Cash Flow	Rs m	-77	-2	-

Current Valuations for NECTAR LIFESCIENCE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -1.1, an decline from the EPS of Rs 1.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 15.9, stands at -14.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.3 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at 15.6 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	63.0	58.0
TTM Earnings per share	Rs	1.1	-1.1
Diluted earnings per share	Rs	1.1	-1.1
Price to Cash Flow	x	6.6	15.6
TTM P/E ratio	x	21.5	-14.7
Price / Book Value ratio	x	0.7	0.5
Market Cap	Rs m	7,507	5,434
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for NECTAR LIFESCIENCE

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.4x during FY23, from 1.3x 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 deteriorated and stood at 0.5x during FY23, from 1.4x 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 declined and down at -2.3% during FY23, from 2.3% 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 declined and down at 2.9% during FY23, from 8.2% 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 declined and down at 2.6% during FY23, from 4.3% 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	1.3	1.4
Debtors’ Days	Days	116	78
Interest coverage	x	1.4	0.5
Debt to equity ratio	x	0.3	0.2
Return on assets	%	4.3	2.6
Return on equity	%	2.3	-2.3
Return on capital employed	%	8.2	2.9

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

NECTAR LIFESCIENCE Share Price Performance

Over the last one year, NECTAR LIFESCIENCE share price has moved down from Rs 24.1 to Rs 15.9, registering a loss of Rs 8.2 or around 34.1%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 21,883.5 (up 0.4%). Over the last one year it has moved down from 24,303.8 to 21,883.5, a loss of 2,420 points (down 10.0%).

Overall, the S&P BSE SENSEX is up 1.8% over the year.

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