POWER MECH PROJECTS 2022-23 Annual Report Analysis

Fri, 31 Mar

POWER MECH PROJECTS 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.

POWER MECH PROJECTS Income Statement Analysis

• Operating income during the year rose 32.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 38.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 10.9% in FY23 as against 10.5% in FY22.
• Depreciation charges increased by 16.3% and finance costs increased by 12.7% YoY, respectively.
• Other income grew by 10.6% YoY.
• Net profit for the year grew by 49.7% YoY.
• Net profit margins during the year grew from 5.1% in FY22 to 5.8% in FY23.

POWER MECH PROJECTS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	27,105	36,012	32.9%
Other income	Rs m	173	192	10.6%
Total Revenues	Rs m	27,278	36,203	32.7%
Gross profit	Rs m	2,837	3,933	38.6%
Depreciation	Rs m	369	429	16.3%
Interest	Rs m	795	895	12.7%
Profit before tax	Rs m	1,847	2,800	51.6%
Tax	Rs m	462	727	57.3%
Profit after tax	Rs m	1,385	2,073	49.7%
Gross profit margin	%	10.5	10.9
Effective tax rate	%	25.0	26.0
Net profit margin	%	5.1	5.8

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POWER MECH PROJECTS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 19 billion as compared to Rs 16 billion in FY22, thereby witnessing an increase of 18.3%.
• Long-term debt down at Rs 261 million as compared to Rs 350 million during FY22, a fall of 25.4%.
• Current assets rose 21% and stood at Rs 28 billion, while fixed assets rose 7% and stood at Rs 6 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 34 billion as against Rs 28 billion during FY22, thereby witnessing a growth of 19%.

POWER MECH PROJECTS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	10,433	12,754	22.2
Current Liabilities	Rs m	16,068	19,006	18.3
Long-term Debt	Rs m	350	261	-25.4
Total Liabilities	Rs m	28,427	33,726	18.6
Current assets	Rs m	23,176	28,123	21.3
Fixed Assets	Rs m	5,251	5,603	6.7
Total Assets	Rs m	28,427	33,726	18.6

POWER MECH PROJECTS Cash Flow Statement Analysis

• POWER MECH PROJECTS's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 4.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -910 million, an improvement of 75.8% 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 -290 million from the Rs 597 million net cash flows seen during FY22.

POWER MECH PROJECTS 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	1,747	1,823	4.4%
Cash Flow from Investing Activities	Rs m	-518	-910	-
Cash Flow from Financing Activities	Rs m	-632	-1,203	-
Net Cash Flow	Rs m	597	-290	-

Current Valuations for POWER MECH PROJECTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 139.0, an improvement from the EPS of Rs 94.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,464.2, stands at 18.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 1.0 times.
• The company's price to cash flow (P/CF) ratio stood at 9.8 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	1,842.6	2,415.3
TTM Earnings per share	Rs	94.1	139.0
Diluted earnings per share	Rs	87.6	131.1
Price to Cash Flow	x	7.6	9.8
TTM P/E ratio	x	9.4	18.1
Price / Book Value ratio	x	1.2	1.9
Market Cap	Rs m	12,037	24,543
Dividends per share (Unadj.)	Rs	1.5	2.0

Ratio Analysis for POWER MECH PROJECTS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.5x during FY23, from 1.4x 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 4.1x during FY23, from 3.3x 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 16.3% during FY23, from 13.3% 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 28.4% during FY23, from 24.5% 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 8.8% during FY23, from 7.7% 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	1.4	1.5
Debtors’ Days	Days	9	9
Interest coverage	x	3.3	4.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.7	8.8
Return on equity	%	13.3	16.3
Return on capital employed	%	24.5	28.4

To see how POWER MECH PROJECTS has performed over the last 5 years, please visit here.

POWER MECH PROJECTS Share Price Performance

Over the last one year, POWER MECH PROJECTS share price has moved up from Rs 838.0 to Rs 2,464.2, registering a gain of Rs 1,626.2 or around 194.1%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 34,369.7 (up 1.2%). Over the last one year it has moved up from 27,506.0 to 34,369.7, a gain of 6,864 points (up 25.0%).

Overall, the S&P BSE SENSEX is up 1.8% over the year.

(To know more, check out historical annual results for POWER MECH PROJECTS and quarterly results for POWER MECH PROJECTS)