PRIME SECURITIES 2022-23 Annual Report Analysis

Thu, 25 May

PRIME SECURITIES 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.

PRIME SECURITIES Income Statement Analysis

• Operating income during the year fell 2.4% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 49.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 23.1% in FY23 as against 44.3% in FY22.
• Depreciation charges increased by 31.0% and finance costs increased by 32.6% YoY, respectively.
• Other income grew by 73.9% YoY.
• Net profit for the year declined by 34.2% YoY.
• Net profit margins during the year declined from 40.9% in FY22 to 27.6% in FY23.

PRIME SECURITIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	415	405	-2.4%
Other income	Rs m	43	75	73.9%
Total Revenues	Rs m	459	481	4.8%
Gross profit	Rs m	184	94	-49.2%
Depreciation	Rs m	9	11	31.0%
Interest	Rs m	4	6	32.6%
Profit before tax	Rs m	214	152	-29.2%
Tax	Rs m	44	40	-10.1%
Profit after tax	Rs m	170	112	-34.2%
Gross profit margin	%	44.3	23.1
Effective tax rate	%	20.7	26.3
Net profit margin	%	40.9	27.6

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PRIME SECURITIES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 99 million as compared to Rs 118 million in FY22, thereby witnessing an decrease of -16.2%.
• Long-term debt down at Rs 0 million as compared to Rs 50 million during FY22, a fall of 99.6%.
• Current assets rose 4% and stood at Rs 789 million, while fixed assets fell 17% and stood at Rs 658 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 1 billion as against Rs 2 billion during FY22, thereby witnessing a fall of 7%.

PRIME SECURITIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	1,019	1,202	18.0
Current Liabilities	Rs m	118	99	-16.2
Long-term Debt	Rs m	50	0	-99.6
Total Liabilities	Rs m	1,549	1,447	-6.6
Current assets	Rs m	755	789	4.4
Fixed Assets	Rs m	793	658	-17.0
Total Assets	Rs m	1,549	1,447	-6.6

PRIME SECURITIES Cash Flow Statement Analysis

• PRIME SECURITIES's cash flow from operating activities (CFO) during FY23 stood at Rs -53 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 35 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -61 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -79 million from the Rs -132 million net cash flows seen during FY22.

PRIME SECURITIES 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	12	-53	-
Cash Flow from Investing Activities	Rs m	-482	35	-
Cash Flow from Financing Activities	Rs m	337	-61	-
Net Cash Flow	Rs m	-132	-79	-

Current Valuations for PRIME SECURITIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.5, an decline from the EPS of Rs 5.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 111.9, stands at 32.5 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 8.9 times.
• The company's price to cash flow (P/CF) ratio stood at 28.0 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	13.3	12.5
TTM Earnings per share	Rs	5.4	3.5
Diluted earnings per share	Rs	5.2	3.4
Price to Cash Flow	x	16.8	28.0
TTM P/E ratio	x	17.7	32.5
Price / Book Value ratio	x	2.6	2.9
Market Cap	Rs m	2,701	3,446
Dividends per share (Unadj.)	Rs	2.3	0.5

Ratio Analysis for PRIME SECURITIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 7.9x during FY23, from 6.4x 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 deteriorated and stood at 27.6x during FY23, from 50.8x 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 9.3% during FY23, from 16.7% 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 13.1% during FY23, from 20.4% 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 8.1% during FY23, from 11.2% 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	6.4	7.9
Debtors’ Days	Days	652	1,739
Interest coverage	x	50.8	27.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.2	8.1
Return on equity	%	16.7	9.3
Return on capital employed	%	20.4	13.1

To see how PRIME SECURITIES has performed over the last 5 years, please visit here.

PRIME SECURITIES Share Price Performance

Over the last one year, PRIME SECURITIES share price has moved up from Rs 92.7 to Rs 111.9, registering a gain of Rs 19.2 or around 20.7%.

Overall, the S&P BSE SENSEX is up 13.4% over the year.

(To know more, check out historical annual results for PRIME SECURITIES and quarterly results for PRIME SECURITIES)