NCC 2018-19 Annual Report Analysis

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NCC 2018-19 Annual Report Analysis
Wed, 25 Sep

NCC has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

NCC Income Statement Analysis

  • Operating income during the year rose 53.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 81.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 12.4% in FY19 as against 10.5% in FY18.
  • Depreciation charges increased by 12.3% and finance costs increased by 13.6% YoY, respectively.
  • Other income grew by 22.7% YoY.
  • Net profit for the year grew by 309.1% YoY.
  • Net profit margins during the year grew from 1.6% in FY18 to 4.4% in FY19.

NCC Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 83,906 128,956 53.7%
Other income Rs m 1,014 1,243 22.7%
Total Revenues Rs m 84,920 130,200 53.3%
Gross profit Rs m 8,794 15,992 81.8%
Depreciation Rs m 1,715 1,925 12.3%
Interest Rs m 4,596 5,220 13.6%
Profit before tax Rs m 3,497 10,090 188.6%
Tax Rs m 802 3,268 307.6%
Profit after tax Rs m 1,387 5,676 309.1%
Gross profit margin % 10.5 12.4
Effective tax rate % 22.9 32.4
Net profit margin % 1.6 4.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NCC Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 90 billion as compared to Rs 73 billion in FY18, thereby witnessing an increase of 22.7%.
  • Long-term debt stood at Rs 5 billion as compared to Rs 4 billion during FY18, a growth of 22.6%.
  • Current assets rose 19% and stood at Rs 115 billion, while fixed assets rose 32% and stood at Rs 16 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 147 billion as against Rs 124 billion during FY18, thereby witnessing a growth of 18%.

NCC Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 40,825 45,954 12.6
 
Current Liabilities Rs m 73,205 89,851 22.7
Long-term Debt Rs m 3,984 4,884 22.6
Total Liabilities Rs m 124,084 146,604 18.1
 
Current assets Rs m 96,377 115,171 19.5
Fixed Assets Rs m 11,813 15,642 32.4
Total Assets Rs m 124,084 146,604 18.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NCC Cash Flow Statement Analysis

  • NCC's cash flow from operating activities (CFO) during FY19 stood at Rs 7 billion, an improvement of 14.9% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -6 billion, an improvement of 228.6% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 892 million, an improvement of 120% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 1 billion from the Rs -560 million net cash flows seen during FY18.

NCC Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 5,858 6,731 14.9%
Cash Flow from Investing Activities Rs m -1,883 -6,189 -
Cash Flow from Financing Activities Rs m -4,535 892 -
Net Cash Flow Rs m -560 1,434 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for NCC

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.4, an improvement from the EPS of Rs 2.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 62.8, stands at 6.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.3 times, while the price to sales ratio stands at 0.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 4.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 139.7 214.7
TTM Earnings per share Rs 2.3 9.4
Diluted earnings per share Rs 2.5 10.2
Price to Cash Flow x 11.9 4.6
TTM P/E ratio x 6.9 6.4
Price / Book Value ratio x 1.6 1.3
Market Cap Rs m 37,721 34,912
Dividends per share (Unadj.) Rs 1.0 1.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for NCC

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY19, from 1.3x during FY18. 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 2.9x during FY19, from 1.8x during FY18. 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 12.4% during FY19, from 3.4% during FY19. 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 27.9% during FY19, from 15.1% during FY18. 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 7.4% during FY19, from 4.8% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.3 1.3
Debtors’ Days Days 216 97
Interest coverage x 1.8 2.9
Debt to equity ratio x 0.1 0.1
Return on assets % 4.8 7.4
Return on equity % 3.4 12.4
Return on capital employed % 15.1 27.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

NCC Share Price Performance

Over the last one year, NCC share price has moved down from Rs 79.7 to Rs 62.8, registering a loss of Rs 16.9 or around 21.2%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 2,045.7 (down 1.3%). Over the last one year it has moved up from 1,810.5 to 2,045.7, a gain of 235 points (up 13.0%).

Overall, the S&P BSE SENSEX is up 6.7% over the year.

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

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