NTPC 2018-19 Annual Report Analysis

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NTPC 2018-19 Annual Report Analysis
Thu, 1 Aug

NTPC 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.

NTPC Income Statement Analysis

  • Operating income during the year rose 8.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 7.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 25.2% in FY19 as against 25.5% in FY18.
  • Depreciation charges increased by 3.1% and finance costs increased by 18.6% YoY, respectively.
  • Other income grew by 15.2% YoY.
  • Net profit for the year grew by 144.8% YoY.
  • Net profit margins during the year grew from 7.7% in FY18 to 17.3% in FY19.

NTPC Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 880,833 957,420 8.7%
Other income Rs m 15,583 17,953 15.2%
Total Revenues Rs m 896,416 975,373 8.8%
Gross profit Rs m 224,205 241,095 7.5%
Depreciation Rs m 74,599 76,881 3.1%
Interest Rs m 44,346 52,609 18.6%
Profit before tax Rs m 120,842 129,559 7.2%
Tax Rs m 56,529 -32,064 -156.7%
Profit after tax Rs m 68,763 168,344 144.8%
Gross profit margin % 25.5 25.2
Effective tax rate % 46.8 -24.7
Net profit margin % 7.7 17.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NTPC Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 597 billion as compared to Rs 456 billion in FY18, thereby witnessing an increase of 30.8%.
  • Long-term debt stood at Rs 1,378 billion as compared to Rs 1,168 billion during FY18, a growth of 18.0%.
  • Current assets rose 16% and stood at Rs 455 billion, while fixed assets rose 15% and stood at Rs 2,526 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 3,174 billion as against Rs 2,824 billion during FY18, thereby witnessing a growth of 12%.

NTPC Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 1,035,635 1,100,370 6.3
 
Current Liabilities Rs m 456,499 597,298 30.8
Long-term Debt Rs m 1,167,758 1,377,929 18.0
Total Liabilities Rs m 2,823,617 3,173,964 12.4
 
Current assets Rs m 392,697 454,987 15.9
Fixed Assets Rs m 2,204,009 2,525,889 14.6
Total Assets Rs m 2,823,617 3,173,964 12.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NTPC Cash Flow Statement Analysis

  • NTPC's cash flow from operating activities (CFO) during FY19 stood at Rs 164 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -222 billion, an improvement of 7.5% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 57 billion, an improvement of 454% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -2 billion from the Rs 193 million net cash flows seen during FY18.

NTPC 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 196,696 163,671 -16.8%
Cash Flow from Investing Activities Rs m -206,781 -222,389 -
Cash Flow from Financing Activities Rs m 10,278 56,976 454.4%
Net Cash Flow Rs m 193 -1,741 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for NTPC

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 17.0, an improvement from the EPS of Rs 8.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 126.6, stands at 7.0 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 1.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 5.3 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 106.8 96.8
TTM Earnings per share Rs 8.3 17.0
Diluted earnings per share Rs 6.9 17.0
Price to Cash Flow x 7.5 5.3
TTM P/E ratio x 5.8 7.0
Price / Book Value ratio x 1.4 1.4
Market Cap Rs m 1,043,463 1,252,157
Dividends per share (Unadj.) Rs 5.1 6.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for NTPC

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 0.8x during FY19, from 0.9x 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 deteriorated and stood at 3.5x during FY19, from 3.7x 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 15.3% during FY19, from 6.6% 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 declined and down at 7.6% during FY19, from 7.7% 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 7.0% during FY19, from 4.0% 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 0.9 0.8
Debtors’ Days Days 37 39
Interest coverage x 3.7 3.5
Debt to equity ratio x 1.1 1.3
Return on assets % 4.0 7.0
Return on equity % 6.6 15.3
Return on capital employed % 7.7 7.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

NTPC Share Price Performance

Over the last one year, NTPC share price has moved down from Rs 155.4 to Rs 126.6, registering a loss of Rs 28.8 or around 18.5%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 1,960.8 (down 0.3%). Over the last one year it has moved down from 1,972.4 to 1,960.8, a loss of 12 points (down 0.6%).

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

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

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