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RCF 2018-19 Annual Report Analysis
Sun, 31 Mar

RCF 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.

RCF Income Statement Analysis

  • Operating income during the year rose 22.9% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 95.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 4.7% in FY19 as against 2.9% in FY18.
  • Depreciation charges increased by 13.6% and finance costs increased by 134.3% YoY, respectively.
  • Other income grew by 10.9% YoY.
  • Net profit for the year grew by 76.6% YoY.
  • Net profit margins during the year grew from 1.1% in FY18 to 1.6% in FY19.

RCF Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 72,279 88,855 22.9%
Other income Rs m 1,200 1,332 10.9%
Total Revenues Rs m 73,480 90,186 22.7%
Gross profit Rs m 2,122 4,146 95.4%
Depreciation Rs m 1,370 1,557 13.6%
Interest Rs m 669 1,569 134.3%
Profit before tax Rs m 1,282 2,353 83.5%
Tax Rs m 494 961 94.4%
Profit after tax Rs m 788 1,392 76.6%
Gross profit margin % 2.9 4.7
Effective tax rate % 38.5 40.8
Net profit margin % 1.1 1.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

RCF Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 47 billion as compared to Rs 23 billion in FY18, thereby witnessing an increase of 102.2%.
  • Long-term debt stood at Rs 4 billion as compared to Rs 3 billion during FY18, a growth of 32.8%.
  • Current assets rose 63% and stood at Rs 63 billion, while fixed assets rose 6% and stood at Rs 26 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 89 billion as against Rs 63 billion during FY18, thereby witnessing a growth of 41%.

RCF Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 29,297 30,285 3.4
 
Current Liabilities Rs m 23,274 47,051 102.2
Long-term Debt Rs m 3,201 4,251 32.8
Total Liabilities Rs m 63,236 89,143 41.0
 
Current assets Rs m 38,692 63,109 63.1
Fixed Assets Rs m 24,544 26,033 6.1
Total Assets Rs m 63,236 89,143 41.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



RCF Cash Flow Statement Analysis

  • RCF's cash flow from operating activities (CFO) during FY19 stood at Rs -16 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -3 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 19 billion, an improvement of 431% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -17 million from the Rs -51 million net cash flows seen during FY18.

RCF 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 10,781 -16,364 -
Cash Flow from Investing Activities Rs m -4,957 -3,103 -
Cash Flow from Financing Activities Rs m -5,875 19,451 -
Net Cash Flow Rs m -51 -17 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for RCF

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.5, an improvement from the EPS of Rs 1.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 58.5, stands at 23.2 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.1 times, while the price to sales ratio stands at 0.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 12.7 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 131.0 161.1
TTM Earnings per share Rs 1.4 2.5
Diluted earnings per share Rs 1.4 2.5
Price to Cash Flow x 18.7 12.7
TTM P/E ratio x 51.2 23.2
Price / Book Value ratio x 1.7 1.2
Market Cap Rs m 50,548 37,473
Dividends per share (Unadj.) Rs 0.6 0.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for RCF

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.3x 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 2.5x during FY19, from 2.9x 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 improved and stood at 4.6% during FY19, from 2.7% 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 improved and stood at 11.4% during FY19, from 6.0% 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 improved and stood at 3.3% during FY19, from 2.3% 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 1.3
Debtors’ Days Days 14 19
Interest coverage x 2.9 2.5
Debt to equity ratio x 0.1 0.1
Return on assets % 2.3 3.3
Return on equity % 2.7 4.6
Return on capital employed % 6.0 11.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

RCF Share Price Performance

Over the last one year, RCF share price has moved down from Rs 73.2 to Rs 58.5, registering a loss of Rs 14.7 or around 20.1%.

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

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

Annual Report FAQs

What is the current share price of RCF?

RCF currently trades at Rs 128.2 per share. You can check out the latest share price performance of RCF here...

What was the revenue of RCF in FY19? How does it compare to earlier years?

The revenues of RCF stood at Rs 90,186 m in FY19, which was up 22.7% compared to Rs 73,480 m reported in FY18.

RCF's revenue has grown from Rs 80,911 m in FY16 to Rs 90,186 m in FY19.

Over the past 4 years, the revenue of RCF has grown at a CAGR of 3.7%.

What was the net profit of RCF in FY19? How does it compare to earlier years?

The net profit of RCF stood at Rs 1,392 m in FY19, which was up 76.6% compared to Rs 788 m reported in FY18.

This compares to a net profit of Rs 1,793 m in FY17 and a net profit of Rs 1,726 m in FY16.

Over the past 4 years, RCF net profit has grown at a CAGR of -6.9%.

What does the cash flow statement of RCF reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of RCF reveals:

  • Cash flow from operations decreased in FY19 and stood at Rs -16,364 m as compared to Rs 10,781 m in FY18.
  • Cash flow from investments increased in FY19 and stood at Rs -3,103 m as compared to Rs -4,957 m in FY18.
  • Cash flow from financial activity increased in FY19 and stood at Rs 19,451 m as compared to Rs -5,875 m in FY18.

Here's the cash flow statement of RCF for the past 4 years.

(Rs m)FY16FY17FY18FY19
From Operations-6,33515,95410,781-16,364
From Investments-2,594-1,803-4,957-3,103
From Financial Activity8,110-14,062-5,87519,451
Net Cashflow-81990-51-17

What does the Key Ratio analysis of RCF reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of RCF reveals:

  • Operating profit margins witnessed a fall and down at 4.7% in FY19 as against 2.9% in FY18.
  • Net profit margins grew from 1.1% in FY18 to 1.6% in FY19.
  • Debt to Equity ratio for FY19 stood at 0.1 as compared to 0.1 in FY18.

Here's the ratio/financial analysis of RCF for the past 4 years.

 FY16FY17FY18FY19
Operating Profit Margin (%)5.35.42.94.7
Net Profit Margin (%)2.22.61.11.6
Debt to Equity Ratio (x)0.10.00.10.1

Read: Latest Annual Report Analysis of RCF

 

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