QUESS CORP 2022-23 Annual Report Analysis

Tue, 5 Sep

QUESS CORP 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.

QUESS CORP Income Statement Analysis

• Operating income during the year rose 25.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 1.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 3.7% in FY23 as against 4.6% in FY22.
• Depreciation charges increased by 29.5% and finance costs increased by 34.2% YoY, respectively.
• Other income grew by 33.0% YoY.
• Net profit for the year declined by 11.2% YoY.
• Net profit margins during the year declined from 1.8% in FY22 to 1.3% in FY23.

QUESS CORP Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	136,918	171,584	25.3%
Other income	Rs m	198	263	33.0%
Total Revenues	Rs m	137,116	171,847	25.3%
Gross profit	Rs m	6,315	6,424	1.7%
Depreciation	Rs m	2,120	2,746	29.5%
Interest	Rs m	817	1,097	34.2%
Profit before tax	Rs m	3,576	2,844	-20.5%
Tax	Rs m	1,066	615	-42.3%
Profit after tax	Rs m	2,510	2,229	-11.2%
Gross profit margin	%	4.6	3.7
Effective tax rate	%	29.8	21.6
Net profit margin	%	1.8	1.3

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QUESS CORP Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 28 billion as compared to Rs 24 billion in FY22, thereby witnessing an increase of 15.1%.
• Long-term debt down at Rs 95 million as compared to Rs 237 million during FY22, a fall of 60.0%.
• Current assets rose 12% and stood at Rs 35 billion, while fixed assets rose 8% and stood at Rs 26 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 61 billion as against Rs 55 billion during FY22, thereby witnessing a growth of 10%.

QUESS CORP Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	23,984	25,002	4.2
Current Liabilities	Rs m	24,309	27,968	15.1
Long-term Debt	Rs m	237	95	-60.0
Total Liabilities	Rs m	55,407	61,124	10.3
Current assets	Rs m	31,580	35,404	12.1
Fixed Assets	Rs m	23,827	25,720	7.9
Total Assets	Rs m	55,407	61,124	10.3

QUESS CORP Cash Flow Statement Analysis

• QUESS CORP's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -23 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -4 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 271 million from the Rs -753 million net cash flows seen during FY22.

QUESS CORP 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	5,539	4,663	-15.8%
Cash Flow from Investing Activities	Rs m	-1,884	-23	-
Cash Flow from Financing Activities	Rs m	-4,413	-4,432	-
Net Cash Flow	Rs m	-753	271	-

Current Valuations for QUESS CORP

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.0, an decline from the EPS of Rs 17.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 420.0, stands at 30.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.5 times, while the price to sales ratio stands at 0.4 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	925.2	1,157.6
TTM Earnings per share	Rs	17.0	15.0
Diluted earnings per share	Rs	16.9	15.0
Price to Cash Flow	x	21.1	15.9
TTM P/E ratio	x	38.6	30.6
Price / Book Value ratio	x	4.7	3.2
Market Cap	Rs m	112,295	78,988
Dividends per share (Unadj.)	Rs	4.0	12.0

Ratio Analysis for QUESS CORP

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY23, from 1.3x 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 3.6x during FY23, from 5.4x 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 8.9% during FY23, from 10.5% 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 15.7% during FY23, from 18.1% 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 5.4% during FY23, from 6.0% 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	1.3	1.3
Debtors’ Days	Days	62	57
Interest coverage	x	5.4	3.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.0	5.4
Return on equity	%	10.5	8.9
Return on capital employed	%	18.1	15.7

To see how QUESS CORP has performed over the last 5 years, please visit here.

QUESS CORP Share Price Performance

Over the last one year, QUESS CORP share price has moved down from Rs 565.8 to Rs 420.0, registering a loss of Rs 145.8 or around 25.8%.

Meanwhile, the S&P BSE IT Index is trading at Rs 32,669.9 (up 0.8%). Over the last one year it has moved up from 28,412.4 to 32,669.9, a gain of 4,258 points (up 15.0%).

Overall, the S&P BSE SENSEX is up 11.9% over the year.

(To know more, check out historical annual results for QUESS CORP and quarterly results for QUESS CORP)