ORIENTAL HOTELS 2022-23 Annual Report Analysis

Fri, 30 Jun

ORIENTAL HOTELS 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.

ORIENTAL HOTELS Income Statement Analysis

• Operating income during the year rose 79.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 379.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 28.5% in FY23 as against 10.7% in FY22.
• Depreciation charges decreased by 13.7% and finance costs decreased by 9.4% YoY, respectively.
• Other income grew by 52.9% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 5.9% in FY22 to 14.1% in FY23.

ORIENTAL HOTELS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	2,194	3,945	79.8%
Other income	Rs m	70	108	52.9%
Total Revenues	Rs m	2,264	4,053	79.0%
Gross profit	Rs m	234	1,123	379.5%
Depreciation	Rs m	263	227	-13.7%
Interest	Rs m	222	201	-9.4%
Profit before tax	Rs m	-180	803	NA
Tax	Rs m	-52	248	NA
Profit after tax	Rs m	-128	555	NA
Gross profit margin	%	10.7	28.5
Effective tax rate	%	28.7	30.9
Net profit margin	%	-5.9	14.1

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ORIENTAL HOTELS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 1 billion as compared to Rs 925 million in FY22, thereby witnessing an increase of 18.1%.
• Long-term debt down at Rs 2 billion as compared to Rs 2 billion during FY22, a fall of 35.0%.
• Current assets fell 3% and stood at Rs 1 billion, while fixed assets rose 8% and stood at Rs 9 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 10 billion as against Rs 9 billion during FY22, thereby witnessing a growth of 7%.

ORIENTAL HOTELS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	4,398	5,390	22.6
Current Liabilities	Rs m	925	1,093	18.1
Long-term Debt	Rs m	2,353	1,528	-35.0
Total Liabilities	Rs m	9,378	10,041	7.1
Current assets	Rs m	1,105	1,075	-2.7
Fixed Assets	Rs m	8,273	8,966	8.4
Total Assets	Rs m	9,378	10,041	7.1

ORIENTAL HOTELS Cash Flow Statement Analysis

• ORIENTAL HOTELS's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 263.2% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -102 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -105 million from the Rs 8 million net cash flows seen during FY22.

ORIENTAL HOTELS 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	286	1,038	263.2%
Cash Flow from Investing Activities	Rs m	-324	-102	-
Cash Flow from Financing Activities	Rs m	44	-1,047	-
Net Cash Flow	Rs m	8	-105	-

Current Valuations for ORIENTAL HOTELS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.1, an improvement from the EPS of Rs -0.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 89.5, stands at 28.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.0 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 15.9 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	12.3	22.1
TTM Earnings per share	Rs	-0.7	3.1
Diluted earnings per share	Rs	-0.7	3.1
Price to Cash Flow	x	84.3	15.9
TTM P/E ratio	x	-88.1	28.8
Price / Book Value ratio	x	1.8	2.3
Market Cap	Rs m	7,823	12,390
Dividends per share (Unadj.)	Rs	0.0	0.5

Ratio Analysis for ORIENTAL HOTELS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.0x during FY23, from 1.2x 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 improved and stood at 5.0x during FY23, from 0.2x 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 improved and stood at 10.3% during FY23, from -2.9% 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 improved and stood at 14.5% during FY23, from 0.6% 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 improved and stood at 7.5% during FY23, from 1.0% 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	1.2	1.0
Debtors’ Days	Days	239	171
Interest coverage	x	0.2	5.0
Debt to equity ratio	x	0.5	0.3
Return on assets	%	1.0	7.5
Return on equity	%	-2.9	10.3
Return on capital employed	%	0.6	14.5

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

ORIENTAL HOTELS Share Price Performance

Over the last one year, ORIENTAL HOTELS share price has moved up from Rs 55.9 to Rs 89.5, registering a gain of Rs 33.6 or around 60.2%.

Overall, the S&P BSE SENSEX is up 21.2% over the year.

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