RICO AUTO 2017-18 Annual Report Analysis

Sat, 31 Mar

RICO AUTO has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

RICO AUTO Income Statement Analysis

• Operating income during the year rose 23.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 12.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 10.4% in FY18 as against 11.4% in FY17.
• Depreciation charges increased by 16.4% and finance costs increased by 12.1% YoY, respectively.
• Other income grew by 21.3% YoY.
• Net profit for the year grew by 13.4% YoY.
• Net profit margins during the year declined from 5.1% in FY17 to 4.6% in FY18.

RICO AUTO Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	9,620	11,890	23.6%
Other income	Rs m	133	162	21.3%
Total Revenues	Rs m	9,753	12,052	23.6%
Gross profit	Rs m	1,100	1,237	12.4%
Depreciation	Rs m	463	539	16.4%
Interest	Rs m	167	187	12.1%
Profit before tax	Rs m	603	672	11.4%
Tax	Rs m	117	121	3.3%
Profit after tax	Rs m	486	551	13.4%
Gross profit margin	%	11.4	10.4
Effective tax rate	%	19.4	18.0
Net profit margin	%	5.1	4.6

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RICO AUTO Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 4 billion as compared to Rs 3 billion in FY17, thereby witnessing an increase of 24.5%.
• Long-term debt down at Rs 631 million as compared to Rs 673 million during FY17, a fall of 6.2%.
• Current assets rose 21% and stood at Rs 5 billion, while fixed assets rose 6% and stood at Rs 6 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 11 billion as against Rs 10 billion during FY17, thereby witnessing a growth of 12%.

RICO AUTO Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	5,237	5,633	7.5
Current Liabilities	Rs m	3,423	4,263	24.5
Long-term Debt	Rs m	673	631	-6.2
Total Liabilities	Rs m	9,672	10,826	11.9
Current assets	Rs m	3,766	4,551	20.9
Fixed Assets	Rs m	5,906	6,275	6.3
Total Assets	Rs m	9,672	10,826	11.9

RICO AUTO Cash Flow Statement Analysis

• RICO AUTO's cash flow from operating activities (CFO) during FY18 stood at Rs 856 million, an improvement of 13.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -789 million, an improvement of 18.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -11 million, an improvement of 87% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 65 million from the Rs -12 million net cash flows seen during FY17.

RICO AUTO Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	752	856	13.9%
Cash Flow from Investing Activities	Rs m	-667	-789	-
Cash Flow from Financing Activities	Rs m	-83	-11	-
Net Cash Flow	Rs m	-12	65	-

Current Valuations for RICO AUTO

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.1, an improvement from the EPS of Rs 3.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 78.7, stands at 18.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 9.4 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	71.1	87.9
TTM Earnings per share	Rs	3.6	4.1
Diluted earnings per share	Rs	3.6	4.1
Price to Cash Flow	x	8.0	9.4
TTM P/E ratio	x	8.6	18.8
Price / Book Value ratio	x	1.4	1.8
Market Cap	Rs m	7,373	10,299
Dividends per share (Unadj.)	Rs	0.8	0.8

Ratio Analysis for RICO AUTO

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.1x during FY18, from 1.1x during FY17. 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 4.6x during FY18, from 4.6x during FY17. 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 9.8% during FY18, from 9.3% during FY18. 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 13.7% during FY18, from 13.0% during FY17. 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 6.8% during FY18, from 6.8% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	1.1	1.1
Debtors’ Days	Days	6	7
Interest coverage	x	4.6	4.6
Debt to equity ratio	x	0.1	0.1
Return on assets	%	6.8	6.8
Return on equity	%	9.3	9.8
Return on capital employed	%	13.0	13.7

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

RICO AUTO Share Price Performance

Over the last one year, RICO AUTO share price has moved up from Rs 56.4 to Rs 78.7, registering a gain of Rs 22.3 or around 39.5%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of RICO AUTO