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ONWARD TECHNOLOGIES 2022-23 Annual Report Analysis

Mon, 26 Jun

ONWARD TECHNOLOGIES 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.

ONWARD TECHNOLOGIES Income Statement Analysis

• Operating income during the year rose 43.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 27.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.2% in FY23 as against 7.0% in FY22.
• Depreciation charges increased by 28.5% and finance costs increased by 65.4% YoY, respectively.
• Other income declined by 74.9% YoY.
• Net profit for the year declined by 51.5% YoY.
• Net profit margins during the year declined from 7.7% in FY22 to 2.6% in FY23.

ONWARD TECHNOLOGIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	3,073	4,409	43.5%
Other income	Rs m	215	54	-74.9%
Total Revenues	Rs m	3,288	4,463	35.7%
Gross profit	Rs m	214	273	27.4%
Depreciation	Rs m	101	130	28.5%
Interest	Rs m	10	17	65.4%
Profit before tax	Rs m	318	180	-43.3%
Tax	Rs m	81	66	-19.6%
Profit after tax	Rs m	237	115	-51.5%
Gross profit margin	%	7.0	6.2
Effective tax rate	%	25.6	36.3
Net profit margin	%	7.7	2.6

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ONWARD TECHNOLOGIES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 552 million as compared to Rs 482 million in FY22, thereby witnessing an increase of 14.5%.
• Long-term debt down at Rs 4 million as compared to Rs 5 million during FY22, a fall of 20.0%.
• Current assets rose 12% and stood at Rs 2 billion, while fixed assets fell 5% and stood at Rs 744 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 2 billion as against Rs 2 billion during FY22, thereby witnessing a growth of 6%.

ONWARD TECHNOLOGIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	1,605	1,698	5.8
Current Liabilities	Rs m	482	552	14.5
Long-term Debt	Rs m	5	4	-20.0
Total Liabilities	Rs m	2,266	2,403	6.1
Current assets	Rs m	1,481	1,659	12.0
Fixed Assets	Rs m	785	744	-5.2
Total Assets	Rs m	2,266	2,403	6.1

ONWARD TECHNOLOGIES Cash Flow Statement Analysis

• ONWARD TECHNOLOGIES's cash flow from operating activities (CFO) during FY23 stood at Rs 57 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 60 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -142 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -23 million from the Rs 210 million net cash flows seen during FY22.

ONWARD TECHNOLOGIES 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	-39	57	-
Cash Flow from Investing Activities	Rs m	-316	60	-
Cash Flow from Financing Activities	Rs m	566	-142	-
Net Cash Flow	Rs m	210	-23	-

Current Valuations for ONWARD TECHNOLOGIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.1, an decline from the EPS of Rs 10.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 494.4, stands at 96.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.5 times, while the price to sales ratio stands at 2.5 times.
• The company's price to cash flow (P/CF) ratio stood at 29.7 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	139.5	197.6
TTM Earnings per share	Rs	10.8	5.1
Diluted earnings per share	Rs	10.6	5.1
Price to Cash Flow	x	23.9	29.7
TTM P/E ratio	x	34.0	96.3
Price / Book Value ratio	x	3.5	4.3
Market Cap	Rs m	5,621	7,262
Dividends per share (Unadj.)	Rs	3.0	3.0

Ratio Analysis for ONWARD TECHNOLOGIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 3.0x during FY23, from 3.1x 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 11.8x during FY23, from 32.6x 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 declined and down at 6.8% during FY23, from 14.8% 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 11.6% during FY23, from 20.4% 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 5.5% during FY23, from 10.9% 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	3.1	3.0
Debtors’ Days	Days	791	908
Interest coverage	x	32.6	11.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	10.9	5.5
Return on equity	%	14.8	6.8
Return on capital employed	%	20.4	11.6

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

ONWARD TECHNOLOGIES Share Price Performance

Over the last one year, ONWARD TECHNOLOGIES share price has moved up from Rs 279.0 to Rs 494.4, registering a gain of Rs 215.4 or around 77.2%.

Meanwhile, the S&P BSE IT Index is trading at Rs 28,903.9 (up 0.2%). Over the last one year it has moved up from 28,147.6 to 28,903.9, a gain of 756 points (up 2.7%).

Overall, the S&P BSE SENSEX is up 21.5% over the year.

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