PIDILITE INDUSTRIES 2020-21 Annual Report Analysis

Wed, 31 Mar

PIDILITE INDUSTRIES 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.

PIDILITE INDUSTRIES Income Statement Analysis

• Operating income during the year fell 0.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 10.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.0% in FY21 as against 20.8% in FY20.
• Depreciation charges increased by 18.1% and finance costs increased by 10.8% YoY, respectively.
• Other income declined by 46.9% YoY.
• Net profit for the year grew by 0.3% YoY.
• Net profit margins during the year grew from 15.3% in FY20 to 15.4% in FY21.

PIDILITE INDUSTRIES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	72,945	72,927	0.0%
Other income	Rs m	1,494	794	-46.9%
Total Revenues	Rs m	74,439	73,721	-1.0%
Gross profit	Rs m	15,208	16,770	10.3%
Depreciation	Rs m	1,699	2,007	18.1%
Interest	Rs m	336	372	10.8%
Profit before tax	Rs m	14,667	15,185	3.5%
Tax	Rs m	3,477	3,964	14.0%
Profit after tax	Rs m	11,190	11,222	0.3%
Gross profit margin	%	20.8	23.0
Effective tax rate	%	23.7	26.1
Net profit margin	%	15.3	15.4

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PIDILITE INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 24 billion as compared to Rs 16 billion in FY20, thereby witnessing an increase of 50.8%.
• Long-term debt down at Rs 124 million as compared to Rs 251 million during FY20, a fall of 50.7%.
• Current assets fell 7% and stood at Rs 35 billion, while fixed assets rose 92% and stood at Rs 53 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 88 billion as against Rs 65 billion during FY20, thereby witnessing a growth of 35%.

PIDILITE INDUSTRIES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	44,447	55,675	25.3
Current Liabilities	Rs m	16,147	24,347	50.8
Long-term Debt	Rs m	251	124	-50.7
Total Liabilities	Rs m	65,227	88,138	35.1
Current assets	Rs m	37,610	35,154	-6.5
Fixed Assets	Rs m	27,618	52,985	91.9
Total Assets	Rs m	65,227	88,138	35.1

PIDILITE INDUSTRIES Cash Flow Statement Analysis

• PIDILITE INDUSTRIES's cash flow from operating activities (CFO) during FY21 stood at Rs 14 billion, an improvement of 8.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -17 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -762 million, an improvement of 91% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -3 billion from the Rs 5 billion net cash flows seen during FY20.

PIDILITE INDUSTRIES 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	12,796	13,921	8.8%
Cash Flow from Investing Activities	Rs m	1,029	-16,879	-
Cash Flow from Financing Activities	Rs m	-8,492	-762	-
Net Cash Flow	Rs m	5,334	-2,792	-

Current Valuations for PIDILITE INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 22.1, an improvement from the EPS of Rs 22.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,810.0, stands at 82.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 16.5 times, while the price to sales ratio stands at 12.6 times.
• The company's price to cash flow (P/CF) ratio stood at 58.5 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	143.6	143.5
TTM Earnings per share	Rs	22.0	22.1
Diluted earnings per share	Rs	22.0	22.1
Price to Cash Flow	x	53.5	58.5
TTM P/E ratio	x	61.6	82.0
Price / Book Value ratio	x	16.0	13.9
Market Cap	Rs m	711,348	774,172
Dividends per share (Unadj.)	Rs	7.0	8.5

Ratio Analysis for PIDILITE INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.4x during FY21, from 2.3x 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 deteriorated and stood at 41.8x during FY21, from 44.7x 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 20.2% during FY21, from 25.2% 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 27.9% during FY21, from 33.6% 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 13.2% during FY21, from 17.7% 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	2.3	1.4
Debtors’ Days	Days	5	7
Interest coverage	x	44.7	41.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	17.7	13.2
Return on equity	%	25.2	20.2
Return on capital employed	%	33.6	27.9

To see how PIDILITE INDUSTRIES has performed over the last 5 years, please visit here.

PIDILITE INDUSTRIES Share Price Performance

Over the last one year, PIDILITE INDUSTRIES share price has moved up from Rs 1,356.7 to Rs 1,810.0, registering a gain of Rs 453.3 or around 33.4%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

(To know more, check out historical annual results for PIDILITE INDUSTRIES and quarterly results for PIDILITE INDUSTRIES)

Read: Latest Annual Report Analysis of PIDILITE INDUSTRIES