RALLIS 2021-22 Annual Report Analysis

Wed, 8 Jun

RALLIS has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

RALLIS Income Statement Analysis

• Operating income during the year rose 7.2% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 18.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 10.5% in FY22 as against 13.7% in FY21.
• Depreciation charges increased by 16.0% and finance costs decreased by 1.4% YoY, respectively.
• Other income declined by 26.9% YoY.
• Net profit for the year declined by 28.2% YoY.
• Net profit margins during the year declined from 9.4% in FY21 to 6.3% in FY22.

RALLIS Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	24,294	26,039	7.2%
Other income	Rs m	405	296	-26.9%
Total Revenues	Rs m	24,699	26,335	6.6%
Gross profit	Rs m	3,339	2,738	-18.0%
Depreciation	Rs m	641	743	16.0%
Interest	Rs m	68	67	-1.4%
Profit before tax	Rs m	3,035	2,224	-26.7%
Tax	Rs m	749	582	-22.3%
Profit after tax	Rs m	2,286	1,642	-28.2%
Gross profit margin	%	13.7	10.5
Effective tax rate	%	24.7	26.2
Net profit margin	%	9.4	6.3

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RALLIS Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 11 billion as compared to Rs 9 billion in FY21, thereby witnessing an increase of 17.7%.
• Long-term debt down at Rs 38 million as compared to Rs 78 million during FY21, a fall of 51.3%.
• Current assets rose 8% and stood at Rs 18 billion, while fixed assets rose 14% and stood at Rs 11 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 29 billion as against Rs 26 billion during FY21, thereby witnessing a growth of 10%.

RALLIS Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	15,908	16,967	6.7
Current Liabilities	Rs m	9,145	10,767	17.7
Long-term Debt	Rs m	78	38	-51.3
Total Liabilities	Rs m	25,886	28,580	10.4
Current assets	Rs m	16,554	17,940	8.4
Fixed Assets	Rs m	9,332	10,641	14.0
Total Assets	Rs m	25,886	28,580	10.4

RALLIS Cash Flow Statement Analysis

• RALLIS's cash flow from operating activities (CFO) during FY22 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -614 million, an improvement of 9% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 3 million from the Rs -122 million net cash flows seen during FY21.

RALLIS Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	2,167	1,658	-23.5%
Cash Flow from Investing Activities	Rs m	-1,615	-1,042	-
Cash Flow from Financing Activities	Rs m	-674	-614	-
Net Cash Flow	Rs m	-122	3	-

Current Valuations for RALLIS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 8.4, an decline from the EPS of Rs 11.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 199.2, stands at 23.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.3 times, while the price to sales ratio stands at 1.5 times.
• The company's price to cash flow (P/CF) ratio stood at 24.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	124.9	133.9
TTM Earnings per share	Rs	11.8	8.4
Diluted earnings per share	Rs	11.8	8.4
Price to Cash Flow	x	16.8	24.0
TTM P/E ratio	x	21.5	23.6
Price / Book Value ratio	x	3.1	3.4
Market Cap	Rs m	49,245	57,252
Dividends per share (Unadj.)	Rs	3.0	3.0

Ratio Analysis for RALLIS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY22, from 1.8x during FY21. 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 34.3x during FY22, from 45.8x during FY21. 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 9.7% during FY22, from 14.4% during FY22. 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 13.5% during FY22, from 19.4% during FY21. 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 6.0% during FY22, from 9.1% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.8	1.7
Debtors’ Days	Days	610	625
Interest coverage	x	45.8	34.3
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.1	6.0
Return on equity	%	14.4	9.7
Return on capital employed	%	19.4	13.5

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 329.4 to Rs 199.2, registering a loss of Rs 130.3 or around 39.5%.

Overall, the S&P BSE SENSEX is up 5.5% 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