ORIENT ELECTRIC 2022-23 Annual Report Analysis

Mon, 10 Jul

ORIENT ELECTRIC 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.

ORIENT ELECTRIC Income Statement Analysis

• Operating income during the year rose 3.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 38.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 5.6% in FY23 as against 9.4% in FY22.
• Depreciation charges increased by 13.6% and finance costs increased by 9.2% YoY, respectively.
• Other income grew by 501.2% YoY.
• Net profit for the year declined by 40.1% YoY.
• Net profit margins during the year declined from 5.2% in FY22 to 3.0% in FY23.

ORIENT ELECTRIC Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	24,484	25,292	3.3%
Other income	Rs m	58	349	501.2%
Total Revenues	Rs m	24,542	25,641	4.5%
Gross profit	Rs m	2,313	1,427	-38.3%
Depreciation	Rs m	471	535	13.6%
Interest	Rs m	203	222	9.2%
Profit before tax	Rs m	1,698	1,019	-40.0%
Tax	Rs m	431	261	-39.5%
Profit after tax	Rs m	1,266	759	-40.1%
Gross profit margin	%	9.4	5.6
Effective tax rate	%	25.4	25.6
Net profit margin	%	5.2	3.0

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ORIENT ELECTRIC Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 6 billion as compared to Rs 6 billion in FY22, thereby witnessing an increase of 2.0%.
• Current assets fell 5% and stood at Rs 9 billion, while fixed assets rose 39% and stood at Rs 4 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 12 billion as against Rs 12 billion during FY22, thereby witnessing a growth of 7%.

ORIENT ELECTRIC Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	5,328	5,795	8.8
Current Liabilities	Rs m	5,722	5,836	2.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	11,611	12,392	6.7
Current assets	Rs m	8,950	8,535	-4.6
Fixed Assets	Rs m	2,661	3,696	38.9
Total Assets	Rs m	11,611	12,392	6.7

ORIENT ELECTRIC Cash Flow Statement Analysis

• ORIENT ELECTRIC's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -661 million, an improvement of 1% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 137 million from the Rs 99 million net cash flows seen during FY22.

ORIENT ELECTRIC 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	-13	1,897	-
Cash Flow from Investing Activities	Rs m	782	-1,099	-
Cash Flow from Financing Activities	Rs m	-670	-661	-
Net Cash Flow	Rs m	99	137	37.7%

Current Valuations for ORIENT ELECTRIC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.6, an decline from the EPS of Rs 6.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 257.4, stands at 72.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.5 times, while the price to sales ratio stands at 2.2 times.
• The company's price to cash flow (P/CF) ratio stood at 49.5 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	115.4	118.9
TTM Earnings per share	Rs	6.0	3.6
Diluted earnings per share	Rs	5.9	3.6
Price to Cash Flow	x	39.5	49.5
TTM P/E ratio	x	54.2	72.4
Price / Book Value ratio	x	13.4	11.1
Market Cap	Rs m	71,247	64,043
Dividends per share (Unadj.)	Rs	2.0	2.3

Ratio Analysis for ORIENT ELECTRIC

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.5x during FY23, from 1.6x 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 5.6x during FY23, from 9.4x 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 13.1% during FY23, from 23.8% 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 21.4% during FY23, from 35.7% 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 7.9% during FY23, from 12.7% 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	1.6	1.5
Debtors’ Days	Days	6	5
Interest coverage	x	9.4	5.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.7	7.9
Return on equity	%	23.8	13.1
Return on capital employed	%	35.7	21.4

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

ORIENT ELECTRIC Share Price Performance

Over the last one year, ORIENT ELECTRIC share price has moved down from Rs 272.0 to Rs 257.4, registering a loss of Rs 14.7 or around 5.4%.

Overall, the S&P BSE SENSEX is up 23.0% over the year.

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