NAHAR SPINNING M 2022-23 Annual Report Analysis

Fri, 31 Mar

NAHAR SPINNING M 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.

NAHAR SPINNING M Income Statement Analysis

• Operating income during the year fell 22.2% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 73.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.6% in FY23 as against 22.5% in FY22.
• Depreciation charges decreased by 3.8% and finance costs decreased by 55.5% YoY, respectively.
• Other income grew by 205.3% YoY.
• Net profit for the year declined by 77.9% YoY.
• Net profit margins during the year declined from 14.0% in FY22 to 4.0% in FY23.

NAHAR SPINNING M Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	35,939	27,969	-22.2%
Other income	Rs m	145	443	205.3%
Total Revenues	Rs m	36,084	28,412	-21.3%
Gross profit	Rs m	8,103	2,118	-73.9%
Depreciation	Rs m	755	726	-3.8%
Interest	Rs m	747	332	-55.5%
Profit before tax	Rs m	6,747	1,503	-77.7%
Tax	Rs m	1,725	396	-77.1%
Profit after tax	Rs m	5,022	1,108	-77.9%
Gross profit margin	%	22.5	7.6
Effective tax rate	%	25.6	26.3
Net profit margin	%	14.0	4.0

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NAHAR SPINNING M Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 7 billion as compared to Rs 13 billion in FY22, thereby witnessing an decrease of -43.4%.
• Long-term debt stood at Rs 2 billion as compared to Rs 2 billion during FY22, a growth of 38.3%.
• Current assets fell 30% and stood at Rs 14 billion, while fixed assets rose 1% and stood at Rs 12 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 26 billion as against Rs 31 billion during FY22, thereby witnessing a fall of 18%.

NAHAR SPINNING M Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	16,006	15,539	-2.9
Current Liabilities	Rs m	13,065	7,399	-43.4
Long-term Debt	Rs m	1,577	2,181	38.3
Total Liabilities	Rs m	31,209	25,520	-18.2
Current assets	Rs m	19,381	13,614	-29.8
Fixed Assets	Rs m	11,828	11,906	0.7
Total Assets	Rs m	31,209	25,520	-18.2

NAHAR SPINNING M Cash Flow Statement Analysis

• NAHAR SPINNING M's cash flow from operating activities (CFO) during FY23 stood at Rs 6 billion, an improvement of 133.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -3 billion, an improvement of 59.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 491 million from the Rs 20 million net cash flows seen during FY22.

NAHAR SPINNING M 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	2,613	6,088	133.0%
Cash Flow from Investing Activities	Rs m	-1,608	-2,567	-
Cash Flow from Financing Activities	Rs m	-985	-3,031	-
Net Cash Flow	Rs m	20	491	2,363.4%

Current Valuations for NAHAR SPINNING M

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 30.7, an decline from the EPS of Rs 139.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 240.4, stands at 7.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.6 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at 8.5 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	996.4	775.4
TTM Earnings per share	Rs	139.2	30.7
Diluted earnings per share	Rs	139.2	30.7
Price to Cash Flow	x	3.2	8.5
TTM P/E ratio	x	3.7	7.8
Price / Book Value ratio	x	0.9	1.0
Market Cap	Rs m	14,156	15,501
Dividends per share (Unadj.)	Rs	3.5	1.5

Ratio Analysis for NAHAR SPINNING M

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.8x during FY23, from 1.5x 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 5.5x during FY23, from 10.0x 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 7.1% during FY23, from 31.4% 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 10.4% during FY23, from 42.6% 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 5.6% during FY23, from 18.5% 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	1.5	1.8
Debtors’ Days	Days	531	411
Interest coverage	x	10.0	5.5
Debt to equity ratio	x	0.1	0.1
Return on assets	%	18.5	5.6
Return on equity	%	31.4	7.1
Return on capital employed	%	42.6	10.4

To see how NAHAR SPINNING M has performed over the last 5 years, please visit here.

NAHAR SPINNING M Share Price Performance

Over the last one year, NAHAR SPINNING M share price has moved down from Rs 510.3 to Rs 240.4, registering a loss of Rs 269.9 or around 52.9%.

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

(To know more, check out historical annual results for NAHAR SPINNING M and quarterly results for NAHAR SPINNING M)