RHI MAGNESITA 2020-21 Annual Report Analysis

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RHI MAGNESITA 2020-21 Annual Report Analysis
Thu, 11 Nov

RHI MAGNESITA 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.

RHI MAGNESITA Income Statement Analysis

  • Operating income during the year fell 1.2% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 2.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 15.3% in FY21 as against 15.5% in FY20.
  • Depreciation charges increased by 13.8% and finance costs decreased by 48.1% YoY, respectively.
  • Other income grew by 19.0% YoY.
  • Net profit for the year grew by 0.5% YoY.
  • Net profit margins during the year grew from 9.7% in FY20 to 9.9% in FY21.

RHI MAGNESITA Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 13,876 13,704 -1.2%
Other income Rs m 104 123 19.0%
Total Revenues Rs m 13,979 13,827 -1.1%
Gross profit Rs m 2,152 2,091 -2.8%
Depreciation Rs m 262 298 13.8%
Interest Rs m 135 70 -48.1%
Profit before tax Rs m 1,858 1,846 -0.7%
Tax Rs m 499 480 -3.9%
Profit after tax Rs m 1,359 1,366 0.5%
Gross profit margin % 15.5 15.3
Effective tax rate % 26.9 26.0
Net profit margin % 9.7 9.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Check Out: Why Millions of Dollars are Getting Pumped into this Sector?

RHI MAGNESITA Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 7 billion as compared to Rs 6 billion in FY20, thereby witnessing an increase of 26.7%.
  • Long-term debt stood at Rs 598 million as compared to Rs 576 million during FY20, a growth of 3.8%.
  • Current assets rose 18% and stood at Rs 13 billion, while fixed assets rose 23% and stood at Rs 3 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 16 billion as against Rs 13 billion during FY20, thereby witnessing a growth of 19%.

RHI MAGNESITA Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 6,992 8,017 14.7
 
Current Liabilities Rs m 5,627 7,130 26.7
Long-term Debt Rs m 576 598 3.8
Total Liabilities Rs m 13,236 15,795 19.3
 
Current assets Rs m 10,789 12,783 18.5
Fixed Assets Rs m 2,448 3,013 23.1
Total Assets Rs m 13,236 15,795 19.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



RHI MAGNESITA Cash Flow Statement Analysis

  • RHI MAGNESITA's cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -788 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -537 million, an improvement of 54% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 330 million from the Rs 813 million net cash flows seen during FY20.

RHI MAGNESITA 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 1,732 1,654 -4.5%
Cash Flow from Investing Activities Rs m 260 -788 -
Cash Flow from Financing Activities Rs m -1,179 -537 -
Net Cash Flow Rs m 813 330 -59.5%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for RHI MAGNESITA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.4, an improvement from the EPS of Rs 11.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 345.1, stands at 40.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.8 times, while the price to sales ratio stands at 1.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 33.4 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 115.5 114.1
TTM Earnings per share Rs 11.3 11.4
Diluted earnings per share Rs 8.4 8.5
Price to Cash Flow x 25.6 33.4
TTM P/E ratio x 30.1 40.4
Price / Book Value ratio x 3.2 2.8
Market Cap Rs m 41,454 55,552
Dividends per share (Unadj.) Rs 2.5 2.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for RHI MAGNESITA

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY21, from 1.9x 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 27.2x during FY21, from 14.7x 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 declined and down at 17.0% during FY21, from 19.4% 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 declined and down at 22.2% during FY21, from 26.3% 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 declined and down at 9.1% during FY21, from 11.3% 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 1.9 1.8
Debtors’ Days Days 874 873
Interest coverage x 14.7 27.2
Debt to equity ratio x 0.1 0.1
Return on assets % 11.3 9.1
Return on equity % 19.4 17.0
Return on capital employed % 26.3 22.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

RHI MAGNESITA Share Price Performance

Over the last one year, RHI MAGNESITA share price has moved up from Rs 205.2 to Rs 345.1, registering a gain of Rs 139.9 or around 68.2%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 20,075.0 (down 2.1%). Over the last one year it has moved up from 9,265.1 to 20,075.0, a gain of 10,810 points (up 116.7%).

Overall, the S&P BSE SENSEX is up 41.7% over the year.

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

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