NATIONAL FERT 2022-23 Annual Report Analysis

Thu, 21 Sep

NATIONAL FERT 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.

NATIONAL FERT Income Statement Analysis

• Operating income during the year rose 86.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 186.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 3.6% in FY23 as against 2.4% in FY22.
• Depreciation charges increased by 5.5% and finance costs increased by 124.2% YoY, respectively.
• Other income grew by 425.0% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 0.6% in FY22 to 1.5% in FY23.

NATIONAL FERT Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	158,571	296,165	86.8%
Other income	Rs m	371	1,950	425.0%
Total Revenues	Rs m	158,942	298,115	87.6%
Gross profit	Rs m	3,761	10,774	186.5%
Depreciation	Rs m	3,346	3,528	5.5%
Interest	Rs m	1,372	3,075	124.2%
Profit before tax	Rs m	-585	6,120	NA
Tax	Rs m	366	1,537	319.6%
Profit after tax	Rs m	-951	4,583	NA
Gross profit margin	%	2.4	3.6
Effective tax rate	%	-62.6	25.1
Net profit margin	%	-0.6	1.5

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NATIONAL FERT Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 75 billion as compared to Rs 56 billion in FY22, thereby witnessing an increase of 33.3%.
• Long-term debt down at Rs 5 billion as compared to Rs 6 billion during FY22, a fall of 15.1%.
• Current assets rose 40% and stood at Rs 81 billion, while fixed assets fell 4% and stood at Rs 45 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 126 billion as against Rs 105 billion during FY22, thereby witnessing a growth of 20%.

NATIONAL FERT Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	20,797	25,417	22.2
Current Liabilities	Rs m	56,310	75,056	33.3
Long-term Debt	Rs m	6,297	5,347	-15.1
Total Liabilities	Rs m	105,081	126,271	20.2
Current assets	Rs m	57,929	81,207	40.2
Fixed Assets	Rs m	47,152	45,064	-4.4
Total Assets	Rs m	105,081	126,271	20.2

NATIONAL FERT Cash Flow Statement Analysis

• NATIONAL FERT's cash flow from operating activities (CFO) during FY23 stood at Rs -3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion, an improvement of 59.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 5 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -133 million from the Rs -136 million net cash flows seen during FY22.

NATIONAL FERT 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	-10,292	-3,331	-
Cash Flow from Investing Activities	Rs m	-1,293	-2,058	-
Cash Flow from Financing Activities	Rs m	11,449	5,256	-54.1%
Net Cash Flow	Rs m	-136	-133	-

Current Valuations for NATIONAL FERT

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.3, an improvement from the EPS of Rs -1.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 74.4, stands at 18.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.4 times, while the price to sales ratio stands at 0.1 times.
• The company's price to cash flow (P/CF) ratio stood at 3.6 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	323.2	603.7
TTM Earnings per share	Rs	-1.9	9.3
Diluted earnings per share	Rs	-1.9	9.3
Price to Cash Flow	x	10.9	3.6
TTM P/E ratio	x	24.1	18.2
Price / Book Value ratio	x	1.4	1.2
Market Cap	Rs m	28,159	29,594
Dividends per share (Unadj.)	Rs	0.0	2.8

Ratio Analysis for NATIONAL FERT

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY23, from 1.0x 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 improved and stood at 3.0x during FY23, from 0.6x 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 improved and stood at 18.0% during FY23, from -4.6% 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 improved and stood at 29.9% during FY23, from 2.9% 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 improved and stood at 6.1% during FY23, from 0.4% 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	1.0	1.1
Debtors’ Days	Days	6	5
Interest coverage	x	0.6	3.0
Debt to equity ratio	x	0.3	0.2
Return on assets	%	0.4	6.1
Return on equity	%	-4.6	18.0
Return on capital employed	%	2.9	29.9

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 50.6 to Rs 74.4, registering a gain of Rs 23.8 or around 47.0%.

Overall, the S&P BSE SENSEX is up 10.9% over the year.

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