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NELCO 2021-22 Annual Report Analysis
Tue, 14 Jun

NELCO 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.

NELCO Income Statement Analysis

  • Operating income during the year rose 15.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 13.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 19.5% in FY22 as against 19.7% in FY21.
  • Depreciation charges increased by 13.5% and finance costs decreased by 21.0% YoY, respectively.
  • Other income grew by 67.9% YoY.
  • Net profit for the year grew by 30.1% YoY.
  • Net profit margins during the year grew from 5.5% in FY21 to 6.2% in FY22.

NELCO Income Statement 2021-22

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Net Sales Rs m 2,261 2,601 15.0%
Other income Rs m 31 52 67.9%
Total Revenues Rs m 2,292 2,652 15.7%
Gross profit Rs m 446 508 13.8%
Depreciation Rs m 223 253 13.5%
Interest Rs m 95 75 -21.0%
Profit before tax Rs m 159 232 45.8%
Tax Rs m 35 71 100.9%
Profit after tax Rs m 124 161 30.1%
Gross profit margin % 19.7 19.5
Effective tax rate % 22.2 30.5
Net profit margin % 5.5 6.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



For You: Midcap Stocks Research at Less than Its Launch Price

NELCO Balance Sheet Analysis

  • The company's current liabilities during FY22 stood at Rs 1 billion as compared to Rs 1 billion in FY21, thereby witnessing an increase of 7.8%.
  • Long-term debt stood at Rs 188 million as compared to Rs 151 million during FY21, a growth of 23.8%.
  • Current assets rose 36% and stood at Rs 1 billion, while fixed assets fell 6% and stood at Rs 1 billion in FY22.
  • Overall, the total assets and liabilities for FY22 stood at Rs 3 billion as against Rs 2 billion during FY21, thereby witnessing a growth of 9%.

NELCO Balance Sheet as on March 2022

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Networth Rs m 760 891 17.2
 
Current Liabilities Rs m 1,235 1,332 7.8
Long-term Debt Rs m 151 188 23.8
Total Liabilities Rs m 2,472 2,701 9.3
 
Current assets Rs m 910 1,236 35.8
Fixed Assets Rs m 1,562 1,465 -6.2
Total Assets Rs m 2,472 2,701 9.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



NELCO Cash Flow Statement Analysis

  • NELCO's cash flow from operating activities (CFO) during FY22 stood at Rs 494 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY22 stood at Rs -161 million, an improvement of 112.7% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY22 stood at Rs -196 million, an improvement of 58% on a YoY basis.
  • Overall, net cash flows for the company during FY22 stood at Rs 138 million from the Rs -6 million net cash flows seen during FY21.

NELCO 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 538 494 -8.2%
Cash Flow from Investing Activities Rs m -76 -161 -
Cash Flow from Financing Activities Rs m -469 -196 -
Net Cash Flow Rs m -6 138 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for NELCO

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.0, an improvement from the EPS of Rs 5.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 662.1, stands at 94.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 17.0 times, while the price to sales ratio stands at 5.8 times.
  • The company's price to cash flow (P/CF) ratio stood at 31.6 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 99.1 114.0
TTM Earnings per share Rs 5.4 7.0
Diluted earnings per share Rs 5.4 7.0
Price to Cash Flow x 12.4 31.6
TTM P/E ratio x 34.8 94.0
Price / Book Value ratio x 5.6 14.7
Market Cap Rs m 4,241 13,091
Dividends per share (Unadj.) Rs 1.2 1.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for NELCO

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 0.9x during FY22, from 0.7x 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 4.1x during FY22, from 2.7x 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 18.1% during FY22, from 16.3% 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 improved and stood at 28.5% during FY22, from 27.9% 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 8.7% during FY22, from 8.9% 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 0.7 0.9
Debtors’ Days Days 1,021 1,093
Interest coverage x 2.7 4.1
Debt to equity ratio x 0.2 0.2
Return on assets % 8.9 8.7
Return on equity % 16.3 18.1
Return on capital employed % 27.9 28.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

NELCO Share Price Performance

Over the last one year, NELCO share price has moved up from Rs 268.1 to Rs 662.1, registering a gain of Rs 394.0 or around 147.0%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 26,032.9 (up 0.7%). Over the last one year it has moved up from 22,806.8 to 26,032.9, a gain of 3,226 points (up 14.1%).

Overall, the S&P BSE SENSEX is up 1.0% over the year.

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

Annual Report FAQs

What is the current share price of NELCO?

NELCO currently trades at Rs 751.5 per share. You can check out the latest share price performance of NELCO here...

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

The revenues of NELCO stood at Rs 2,652 m in FY22, which was up 15.7% compared to Rs 2,292 m reported in FY21.

NELCO's revenue has grown from Rs 1,554 m in FY18 to Rs 2,652 m in FY22.

Over the past 5 years, the revenue of NELCO has grown at a CAGR of 14.3%.

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

The net profit of NELCO stood at Rs 161 m in FY22, which was up 30.1% compared to Rs 124 m reported in FY21.

This compares to a net profit of Rs 144 m in FY20 and a net profit of Rs 222 m in FY19.

Over the past 5 years, NELCO net profit has grown at a CAGR of 8.6%.

What does the cash flow statement of NELCO 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 NELCO reveals:

  • Cash flow from operations decreased in FY22 and stood at Rs 494 m as compared to Rs 538 m in FY21.
  • Cash flow from investments decreased in FY22 and stood at Rs -161 m as compared to Rs -76 m in FY21.
  • Cash flow from financial activity increased in FY22 and stood at Rs -196 m as compared to Rs -469 m in FY21.

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

(Rs m)FY18FY19FY20FY21FY22
From Operations322212332538494
From Investments-143-447-401-76-161
From Financial Activity-12225045-469-196
Net Cashflow5716-24-6138

What does the Key Ratio analysis of NELCO 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 NELCO reveals:

  • Operating profit margins witnessed a fall and stood at 19.5% in FY22 as against 19.7% in FY21.
  • Net profit margins grew from 5.5% in FY21 to 6.2% in FY22.
  • Debt to Equity ratio for FY22 stood at 0.2 as compared to 0.2 in FY21.

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

 FY18FY19FY20FY21FY22
Operating Profit Margin (%)16.218.522.819.719.5
Net Profit Margin (%)7.711.66.55.56.2
Debt to Equity Ratio (x)0.20.60.40.20.2

Read: Latest Annual Report Analysis of NELCO

 

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