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NEWGEN SOFTWARE 2021-22 Annual Report Analysis
Tue, 31 May

NEWGEN SOFTWARE 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.

NEWGEN SOFTWARE Income Statement Analysis

  • Operating income during the year rose 15.8% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 1.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 25.0% in FY22 as against 28.5% in FY21.
  • Depreciation charges decreased by 12.5% and finance costs decreased by 37.9% YoY, respectively.
  • Other income grew by 98.9% YoY.
  • Net profit for the year grew by 29.8% YoY.
  • Net profit margins during the year grew from 18.8% in FY21 to 21.1% in FY22.

NEWGEN SOFTWARE Income Statement 2021-22

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Net Sales Rs m 6,726 7,790 15.8%
Other income Rs m 150 299 98.9%
Total Revenues Rs m 6,877 8,089 17.6%
Gross profit Rs m 1,919 1,947 1.4%
Depreciation Rs m 202 176 -12.5%
Interest Rs m 56 35 -37.9%
Profit before tax Rs m 1,812 2,035 12.3%
Tax Rs m 547 392 -28.2%
Profit after tax Rs m 1,265 1,642 29.8%
Gross profit margin % 28.5 25.0
Effective tax rate % 30.2 19.3
Net profit margin % 18.8 21.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Enclosed: Invitation to Access Our Latest Research Project

NEWGEN SOFTWARE Balance Sheet Analysis

  • The company's current liabilities during FY22 stood at Rs 2 billion as compared to Rs 2 billion in FY21, thereby witnessing an increase of 12.4%.
  • Long-term debt stood at Rs 43 million as compared to Rs 0 million during FY21, a fall of 0.0%.
  • Current assets rose 15% and stood at Rs 7 billion, while fixed assets rose 58% and stood at Rs 5 billion in FY22.
  • Overall, the total assets and liabilities for FY22 stood at Rs 12 billion as against Rs 10 billion during FY21, thereby witnessing a growth of 29%.

NEWGEN SOFTWARE Balance Sheet as on March 2022

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Networth Rs m 6,623 8,038 21.4
 
Current Liabilities Rs m 2,124 2,388 12.4
Long-term Debt Rs m 0 43 0.0
Total Liabilities Rs m 9,553 12,311 28.9
 
Current assets Rs m 6,489 7,463 15.0
Fixed Assets Rs m 3,064 4,847 58.2
Total Assets Rs m 9,553 12,311 28.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



NEWGEN SOFTWARE Cash Flow Statement Analysis

  • NEWGEN SOFTWARE's cash flow from operating activities (CFO) during FY22 stood at Rs 1 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY22 stood at Rs -806 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY22 stood at Rs -320 million, an improvement of 69% on a YoY basis.
  • Overall, net cash flows for the company during FY22 stood at Rs 319 million from the Rs -284 million net cash flows seen during FY21.

NEWGEN SOFTWARE 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 2,157 1,428 -33.8%
Cash Flow from Investing Activities Rs m -1,430 -806 -
Cash Flow from Financing Activities Rs m -1,023 -320 -
Net Cash Flow Rs m -284 319 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for NEWGEN SOFTWARE

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 23.6, an improvement from the EPS of Rs 18.2 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 386.5, stands at 16.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.4 times, while the price to sales ratio stands at 3.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 19.9 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 97.0 112.0
TTM Earnings per share Rs 18.2 23.6
Diluted earnings per share Rs 18.1 23.5
Price to Cash Flow x 13.5 19.9
TTM P/E ratio x 15.7 16.5
Price / Book Value ratio x 2.3 4.5
Market Cap Rs m 15,060 36,150
Dividends per share (Unadj.) Rs 3.5 4.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for NEWGEN SOFTWARE

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.1x during FY22, from 3.1x 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 improved and stood at 59.3x during FY22, from 33.2x 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 20.4% during FY22, from 19.1% 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 25.6% during FY22, from 28.2% 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 13.6% during FY22, from 13.8% 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 3.1 3.1
Debtors’ Days Days 1,294 1,307
Interest coverage x 33.2 59.3
Debt to equity ratio x 0.0 0.0
Return on assets % 13.8 13.6
Return on equity % 19.1 20.4
Return on capital employed % 28.2 25.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how NEWGEN SOFTWARE has performed over the last 5 years, please visit here.

NEWGEN SOFTWARE Share Price Performance

Over the last one year, NEWGEN SOFTWARE share price has moved down from Rs 412.7 to Rs 386.5, registering a loss of Rs 26.2 or around 6.3%.

Meanwhile, the S&P BSE IT Index is trading at Rs 30,214.6 (down 0.0%). Over the last one year it has moved up from 27,584.8 to 30,214.6, a gain of 2,630 points (up 9.5%).

Overall, the S&P BSE SENSEX is up 9.3% over the year.

(To know more, check out historical annual results for NEWGEN SOFTWARE and quarterly results for NEWGEN SOFTWARE)

Annual Report FAQs

What is the current share price of NEWGEN SOFTWARE?

NEWGEN SOFTWARE currently trades at Rs 408.5 per share. You can check out the latest share price performance of NEWGEN SOFTWARE here...

What was the revenue of NEWGEN SOFTWARE in FY22? How does it compare to earlier years?

The revenues of NEWGEN SOFTWARE stood at Rs 8,089 m in FY22, which was up 17.6% compared to Rs 6,877 m reported in FY21.

NEWGEN SOFTWARE's revenue has grown from Rs 5,200 m in FY18 to Rs 8,089 m in FY22.

Over the past 5 years, the revenue of NEWGEN SOFTWARE has grown at a CAGR of 11.7%.

What was the net profit of NEWGEN SOFTWARE in FY22? How does it compare to earlier years?

The net profit of NEWGEN SOFTWARE stood at Rs 1,642 m in FY22, which was up 29.8% compared to Rs 1,265 m reported in FY21.

This compares to a net profit of Rs 727 m in FY20 and a net profit of Rs 1,022 m in FY19.

Over the past 5 years, NEWGEN SOFTWARE net profit has grown at a CAGR of 22.5%.

What does the cash flow statement of NEWGEN SOFTWARE reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of NEWGEN SOFTWARE reveals:

  • Cash flow from operations decreased in FY22 and stood at Rs 1,428 m as compared to Rs 2,157 m in FY21.
  • Cash flow from investments increased in FY22 and stood at Rs -806 m as compared to Rs -1,430 m in FY21.
  • Cash flow from financial activity increased in FY22 and stood at Rs -320 m as compared to Rs -1,023 m in FY21.

Here's the cash flow statement of NEWGEN SOFTWARE for the past 5 years.

(Rs m)FY18FY19FY20FY21FY22
From Operations6021,0229012,1571,428
From Investments-180-854-1,040-1,430-806
From Financial Activity675-51-472-1,023-320
Net Cashflow1,106123-576-284319

What does the Key Ratio analysis of NEWGEN SOFTWARE reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of NEWGEN SOFTWARE reveals:

  • Operating profit margins witnessed a fall and stood at 25.0% in FY22 as against 28.5% in FY21.
  • Net profit margins grew from 18.8% in FY21 to 21.1% in FY22.
  • Debt to Equity ratio for FY22 stood at 0.0 as compared to 0.0 in FY21.

Here's the ratio/financial analysis of NEWGEN SOFTWARE for the past 5 years.

 FY18FY19FY20FY21FY22
Operating Profit Margin (%)19.020.615.828.525.0
Net Profit Margin (%)14.216.511.018.821.1
Debt to Equity Ratio (x)0.00.00.00.00.0

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