NUCLEUS SOFTWARE 2020-21 Annual Report Analysis

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NUCLEUS SOFTWARE 2020-21 Annual Report Analysis
Mon, 8 Nov

NUCLEUS SOFTWARE 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.

NUCLEUS SOFTWARE Income Statement Analysis

  • Operating income during the year fell 1.4% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 37.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 25.2% in FY21 as against 18.1% in FY20.
  • Depreciation charges increased by 2.4% and finance costs increased by 8.9% YoY, respectively.
  • Other income grew by 6.4% YoY.
  • Net profit for the year grew by 32.5% YoY.
  • Net profit margins during the year grew from 15.9% in FY20 to 21.3% in FY21.

NUCLEUS SOFTWARE Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 5,208 5,135 -1.4%
Other income Rs m 372 396 6.4%
Total Revenues Rs m 5,581 5,531 -0.9%
Gross profit Rs m 942 1,293 37.2%
Depreciation Rs m 136 139 2.4%
Interest Rs m 11 12 8.9%
Profit before tax Rs m 1,168 1,538 31.7%
Tax Rs m 278 359 29.0%
Profit after tax Rs m 890 1,180 32.5%
Gross profit margin % 18.1 25.2
Effective tax rate % 23.8 23.3
Net profit margin % 15.9 21.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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NUCLEUS SOFTWARE Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 2 billion as compared to Rs 2 billion in FY20, thereby witnessing an increase of 4.8%.
  • Current assets rose 38% and stood at Rs 6 billion, while fixed assets fell 14% and stood at Rs 3 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 9 billion as against Rs 8 billion during FY20, thereby witnessing a growth of 17%.

NUCLEUS SOFTWARE Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 5,609 6,720 19.8
 
Current Liabilities Rs m 1,890 1,980 4.8
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 7,579 8,847 16.7
 
Current assets Rs m 4,455 6,151 38.1
Fixed Assets Rs m 3,124 2,696 -13.7
Total Assets Rs m 7,579 8,847 16.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



NUCLEUS SOFTWARE Cash Flow Statement Analysis

  • NUCLEUS SOFTWARE's cash flow from operating activities (CFO) during FY21 stood at Rs 1 billion, an improvement of 53.8% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -1 billion, an improvement of 331.8% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -133 million, an improvement of 61% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -245 million from the Rs 123 million net cash flows seen during FY20.

NUCLEUS SOFTWARE 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 747 1,149 53.8%
Cash Flow from Investing Activities Rs m -291 -1,257 -
Cash Flow from Financing Activities Rs m -341 -133 -
Net Cash Flow Rs m 123 -245 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for NUCLEUS SOFTWARE

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 40.6, an improvement from the EPS of Rs 30.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 577.5, stands at 19.1 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 2.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 12.7 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 179.3 176.8
TTM Earnings per share Rs 30.6 40.6
Diluted earnings per share Rs 30.6 40.6
Price to Cash Flow x 16.4 12.7
TTM P/E ratio x 19.1 19.1
Price / Book Value ratio x 1.5 2.0
Market Cap Rs m 16,771 16,771
Dividends per share (Unadj.) Rs 9.0 9.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for NUCLEUS SOFTWARE

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.1x during FY21, from 2.4x 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 127.1x during FY21, from 105.3x 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 17.6% during FY21, from 15.9% 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 23.1% during FY21, from 21.0% 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 13.5% during FY21, from 11.9% 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 2.4 3.1
Debtors’ Days Days 632 609
Interest coverage x 105.3 127.1
Debt to equity ratio x 0.0 0.0
Return on assets % 11.9 13.5
Return on equity % 15.9 17.6
Return on capital employed % 21.0 23.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

NUCLEUS SOFTWARE Share Price Performance

Over the last one year, NUCLEUS SOFTWARE share price has moved down from Rs 582.9 to Rs 577.5, registering a loss of Rs 5.4 or around 0.9%.

Meanwhile, the S&P BSE IT Index is trading at Rs 34,794.5 (up 1.1%). Over the last one year it has moved up from 21,707.5 to 34,794.5, a gain of 13,087 points (up 60.3%).

Overall, the S&P BSE SENSEX is up 49.1% over the year.

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

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