NATIONAL FERT 2020-21 Annual Report Analysis

Wed, 31 Mar

NATIONAL FERT has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

NATIONAL FERT Income Statement Analysis

• Operating income during the year fell 9.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 94.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 7.7% in FY21 as against 3.6% in FY20.
• Depreciation charges decreased by 16.6% and finance costs decreased by 28.1% YoY, respectively.
• Other income declined by 43.7% YoY.
• Net profit for the year declined by 246.0% YoY.
• Net profit margins during the year grew from 1.3% in FY20 to 2.1% in FY21.

NATIONAL FERT Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	131,354	119,057	-9.4%
Other income	Rs m	593	333	-43.7%
Total Revenues	Rs m	131,946	119,390	-9.5%
Gross profit	Rs m	4,717	9,167	94.4%
Depreciation	Rs m	3,744	3,123	-16.6%
Interest	Rs m	4,092	2,943	-28.1%
Profit before tax	Rs m	-2,527	3,435	-235.9%
Tax	Rs m	-817	938	-214.8%
Profit after tax	Rs m	-1,710	2,496	-246.0%
Gross profit margin	%	3.6	7.7
Effective tax rate	%	32.3	27.3
Net profit margin	%	-1.3	2.1

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NATIONAL FERT Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 33 billion as compared to Rs 95 billion in FY20, thereby witnessing an decrease of -65.5%.
• Long-term debt stood at Rs 6 billion as compared to Rs 6 billion during FY20, a growth of 8.6%.
• Current assets fell 64% and stood at Rs 35 billion, while fixed assets rose 4% and stood at Rs 49 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 84 billion as against Rs 145 billion during FY20, thereby witnessing a fall of 42%.

NATIONAL FERT Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	19,022	21,402	12.5
Current Liabilities	Rs m	95,046	32,787	-65.5
Long-term Debt	Rs m	5,969	6,480	8.6
Total Liabilities	Rs m	145,360	84,304	-42.0
Current assets	Rs m	98,157	35,217	-64.1
Fixed Assets	Rs m	47,204	49,086	4.0
Total Assets	Rs m	145,360	84,304	-42.0

NATIONAL FERT Cash Flow Statement Analysis

• NATIONAL FERT's cash flow from operating activities (CFO) during FY21 stood at Rs 70 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -5 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -65 billion on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 198 million from the Rs 29 million net cash flows seen during FY20.

NATIONAL FERT Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	-3,192	70,207	-
Cash Flow from Investing Activities	Rs m	-8,097	-4,961	-
Cash Flow from Financing Activities	Rs m	11,319	-65,048	-
Net Cash Flow	Rs m	29	198	575.8%

Current Valuations for NATIONAL FERT

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.1, an improvement from the EPS of Rs -3.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 56.3, stands at 11.1 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 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at 3.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	267.8	242.7
TTM Earnings per share	Rs	-3.5	5.1
Diluted earnings per share	Rs	-3.5	5.1
Price to Cash Flow	x	4.4	3.8
TTM P/E ratio	x	-4.5	11.1
Price / Book Value ratio	x	0.7	1.0
Market Cap	Rs m	13,712	21,598
Dividends per share (Unadj.)	Rs	1.0	0.0

Ratio Analysis for NATIONAL FERT

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY21, from 1.0x during FY20. 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 2.2x during FY21, from 0.4x during FY20. 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 11.7% during FY21, from -9.0% during FY21. 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 22.9% during FY21, from 6.3% during FY20. 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 6.5% during FY21, from 1.6% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.0	1.1
Debtors’ Days	Days	21	8
Interest coverage	x	0.4	2.2
Debt to equity ratio	x	0.3	0.3
Return on assets	%	1.6	6.5
Return on equity	%	-9.0	11.7
Return on capital employed	%	6.3	22.9

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

NATIONAL FERT Share Price Performance

Over the last one year, NATIONAL FERT share price has moved up from Rs 18.3 to Rs 56.3, registering a gain of Rs 38.0 or around 207.7%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of NATIONAL FERT