RAIN INDUSTRIES 2020-21 Annual Report Analysis

Fri, 31 Dec

RAIN INDUSTRIES has announced its results for the year ended December 2021. Let us have a look at the detailed performance review of the company during FY20-21.

RAIN INDUSTRIES Income Statement Analysis

• Operating income during the year rose 38.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 40.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.2% in CY21 as against 16.0% in CY20.
• Depreciation charges increased by 2.9% and finance costs decreased by 2.4% YoY, respectively.
• Other income declined by 52.9% YoY.
• Net profit for the year grew by 18.1% YoY.
• Net profit margins during the year declined from 5.6% in CY20 to 4.8% in CY21.

RAIN INDUSTRIES Income Statement 2020-21

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*	% Change
Net Sales	Rs m	104,647	145,268	38.8%
Other income	Rs m	4,553	2,143	-52.9%
Total Revenues	Rs m	109,200	147,411	35.0%
Gross profit	Rs m	16,774	23,565	40.5%
Depreciation	Rs m	7,917	8,150	2.9%
Interest	Rs m	4,905	4,789	-2.4%
Profit before tax	Rs m	8,504	12,770	50.2%
Tax	Rs m	2,628	5,829	121.8%
Profit after tax	Rs m	5,877	6,941	18.1%
Gross profit margin	%	16.0	16.2
Effective tax rate	%	30.9	45.6
Net profit margin	%	5.6	4.8

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RAIN INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during CY21 stood at Rs 30 billion as compared to Rs 26 billion in CY20, thereby witnessing an increase of 15.0%.
• Long-term debt down at Rs 78 billion as compared to Rs 80 billion during CY20, a fall of 2.6%.
• Current assets rose 30% and stood at Rs 65 billion, while fixed assets fell 4% and stood at Rs 119 billion in CY21.
• Overall, the total assets and liabilities for CY21 stood at Rs 184 billion as against Rs 174 billion during CY20, thereby witnessing a growth of 5%.

RAIN INDUSTRIES Balance Sheet as on December 2021

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*	% Change
Networth	Rs m	55,335	61,092	10.4
Current Liabilities	Rs m	25,712	29,577	15.0
Long-term Debt	Rs m	80,012	77,968	-2.6
Total Liabilities	Rs m	174,266	183,807	5.5
Current assets	Rs m	49,817	64,774	30.0
Fixed Assets	Rs m	124,448	119,033	-4.4
Total Assets	Rs m	174,266	183,807	5.5

RAIN INDUSTRIES Cash Flow Statement Analysis

• RAIN INDUSTRIES's cash flow from operating activities (CFO) during CY21 stood at Rs 8 billion on a YoY basis.
• Cash flow from investing activities (CFI) during CY21 stood at Rs -5 billion on a YoY basis.
• Cash flow from financial activities (CFF) during CY21 stood at Rs -7 billion on a YoY basis.
• Overall, net cash flows for the company during CY21 stood at Rs -4 billion from the Rs 4 billion net cash flows seen during CY20.

RAIN INDUSTRIES Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Dec-20	Dec-21
Cash Flow from Operating Activities	Rs m	18,225	8,336	-54.3%
Cash Flow from Investing Activities	Rs m	-7,708	-5,268	-
Cash Flow from Financing Activities	Rs m	-5,999	-7,401	-
Net Cash Flow	Rs m	4,247	-4,167	-

Current Valuations for RAIN INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 20.6, an improvement from the EPS of Rs 17.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 239.9, stands at 11.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.3 times, while the price to sales ratio stands at 0.6 times.
• The company's price to cash flow (P/CF) ratio stood at 4.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*
Sales per share (Unadj.)	Rs	311.1	431.9
TTM Earnings per share	Rs	17.5	20.6
Diluted earnings per share	Rs	17.5	20.6
Price to Cash Flow	x	3.1	4.3
TTM P/E ratio	x	7.2	11.6
Price / Book Value ratio	x	0.6	1.1
Market Cap	Rs m	31,465	65,251
Dividends per share (Unadj.)	Rs	1.0	1.0

Ratio Analysis for RAIN INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.2x during CY21, from 1.9x during CY20. 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 3.7x during CY21, from 2.7x during CY20. 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 11.4% during CY21, from 10.6% during CY21. 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 12.6% during CY21, from 9.9% during CY20. 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 6.4% during CY21, from 6.2% during CY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*
Current ratio	x	1.9	2.2
Debtors’ Days	Days	38	42
Interest coverage	x	2.7	3.7
Debt to equity ratio	x	1.4	1.3
Return on assets	%	6.2	6.4
Return on equity	%	10.6	11.4
Return on capital employed	%	9.9	12.6

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

RAIN INDUSTRIES Share Price Performance

Over the last one year, RAIN INDUSTRIES share price has moved up from Rs 55.9 to Rs 142.9, registering a gain of Rs 87.0 or around 155.6%.

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

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

Read: Latest Annual Report Analysis of RAIN INDUSTRIES