RALLIS 2018-19 Annual Report Analysis

Sun, 31 Mar

RALLIS has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

RALLIS Income Statement Analysis

• Operating income during the year rose 11.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 8.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 12.3% in FY19 as against 15.0% in FY18.
• Depreciation charges decreased by 0.5% and finance costs increased by 21.9% YoY, respectively.
• Other income grew by 132.7% YoY.
• Net profit for the year declined by 7.3% YoY.
• Net profit margins during the year declined from 9.4% in FY18 to 7.8% in FY19.

RALLIS Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	17,734	19,840	11.9%
Other income	Rs m	132	307	132.7%
Total Revenues	Rs m	17,866	20,146	12.8%
Gross profit	Rs m	2,668	2,438	-8.6%
Depreciation	Rs m	463	461	-0.5%
Interest	Rs m	66	81	21.9%
Profit before tax	Rs m	2,270	2,203	-3.0%
Tax	Rs m	600	655	9.1%
Profit after tax	Rs m	1,670	1,548	-7.3%
Gross profit margin	%	15.0	12.3
Effective tax rate	%	26.4	29.7
Net profit margin	%	9.4	7.8

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RALLIS Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 8 billion as compared to Rs 7 billion in FY18, thereby witnessing an increase of 12.4%.
• Long-term debt down at Rs 158 million as compared to Rs 199 million during FY18, a fall of 20.5%.
• Current assets rose 14% and stood at Rs 14 billion, while fixed assets rose 2% and stood at Rs 7 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 22 billion as against Rs 20 billion during FY18, thereby witnessing a growth of 9%.

RALLIS Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	11,906	12,859	8.0
Current Liabilities	Rs m	7,244	8,142	12.4
Long-term Debt	Rs m	199	158	-20.5
Total Liabilities	Rs m	19,778	21,626	9.3
Current assets	Rs m	12,411	14,132	13.9
Fixed Assets	Rs m	7,367	7,494	1.7
Total Assets	Rs m	19,778	21,626	9.3

RALLIS Cash Flow Statement Analysis

• RALLIS's cash flow from operating activities (CFO) during FY19 stood at Rs 801 million, an improvement of 93.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -514 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -515 million, an improvement of 51% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -229 million from the Rs 260 million net cash flows seen during FY18.

RALLIS Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	414	801	93.4%
Cash Flow from Investing Activities	Rs m	888	-514	-
Cash Flow from Financing Activities	Rs m	-1,041	-515	-
Net Cash Flow	Rs m	260	-229	-

Current Valuations for RALLIS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.0, an decline from the EPS of Rs 8.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 165.1, stands at 20.7 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 1.6 times.
• The company's price to cash flow (P/CF) ratio stood at 19.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	91.2	102.0
TTM Earnings per share	Rs	8.6	8.0
Diluted earnings per share	Rs	8.6	8.0
Price to Cash Flow	x	21.6	19.1
TTM P/E ratio	x	27.5	20.7
Price / Book Value ratio	x	4.0	3.0
Market Cap	Rs m	48,073	38,427
Dividends per share (Unadj.)	Rs	2.5	2.5

Ratio Analysis for RALLIS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.7x during FY19, from 1.7x during FY18. 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 28.3x during FY19, from 35.3x during FY18. 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 12.0% during FY19, from 14.0% during FY19. 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 17.5% during FY19, from 19.3% during FY18. 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 7.5% during FY19, from 8.8% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	1.7	1.7
Debtors’ Days	Days	823	826
Interest coverage	x	35.3	28.3
Debt to equity ratio	x	0.0	0.0
Return on assets	%	8.8	7.5
Return on equity	%	14.0	12.0
Return on capital employed	%	19.3	17.5

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

RALLIS Share Price Performance

Over the last one year, RALLIS share price has moved down from Rs 236.6 to Rs 165.1, registering a loss of Rs 71.5 or around 30.2%.

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Read: Latest Annual Report Analysis of RALLIS