RENAISSANCE GLOBAL 2022-23 Annual Report Analysis

Mon, 26 Feb

RENAISSANCE GLOBAL 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.

RENAISSANCE GLOBAL Income Statement Analysis

• Operating income during the year rose 2.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 2.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.7% in FY23 as against 8.0% in FY22.
• Depreciation charges decreased by 8.6% and finance costs increased by 46.3% YoY, respectively.
• Other income declined by 79.9% YoY.
• Net profit for the year declined by 17.5% YoY.
• Net profit margins during the year declined from 4.9% in FY22 to 3.9% in FY23.

RENAISSANCE GLOBAL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	21,898	22,366	2.1%
Other income	Rs m	305	61	-79.9%
Total Revenues	Rs m	22,203	22,427	1.0%
Gross profit	Rs m	1,760	1,718	-2.4%
Depreciation	Rs m	351	320	-8.6%
Interest	Rs m	349	511	46.3%
Profit before tax	Rs m	1,365	948	-30.6%
Tax	Rs m	300	70	-76.8%
Profit after tax	Rs m	1,065	878	-17.5%
Gross profit margin	%	8.0	7.7
Effective tax rate	%	22.0	7.3
Net profit margin	%	4.9	3.9

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RENAISSANCE GLOBAL Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 7 billion as compared to Rs 9 billion in FY22, thereby witnessing an decrease of -20.8%.
• Long-term debt down at Rs 442 million as compared to Rs 453 million during FY22, a fall of 2.5%.
• Current assets fell 7% and stood at Rs 16 billion, while fixed assets rose 11% and stood at Rs 3 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 19 billion as against Rs 20 billion during FY22, thereby witnessing a fall of 5%.

RENAISSANCE GLOBAL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	9,139	10,215	11.8
Current Liabilities	Rs m	8,982	7,117	-20.8
Long-term Debt	Rs m	453	442	-2.5
Total Liabilities	Rs m	19,788	18,890	-4.5
Current assets	Rs m	17,213	16,040	-6.8
Fixed Assets	Rs m	2,574	2,850	10.7
Total Assets	Rs m	19,788	18,890	-4.5

RENAISSANCE GLOBAL Cash Flow Statement Analysis

• RENAISSANCE GLOBAL's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 169.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -674 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -538 million from the Rs 5 million net cash flows seen during FY22.

RENAISSANCE GLOBAL 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	855	2,304	169.4%
Cash Flow from Investing Activities	Rs m	-1,169	-674	-
Cash Flow from Financing Activities	Rs m	296	-2,169	-
Net Cash Flow	Rs m	5	-538	-

Current Valuations for RENAISSANCE GLOBAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.3, an decline from the EPS of Rs 56.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 83.4, stands at 9.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.8 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 9.9 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	1,159.9	236.9
TTM Earnings per share	Rs	56.4	9.3
Diluted earnings per share	Rs	11.1	9.1
Price to Cash Flow	x	11.7	9.9
TTM P/E ratio	x	15.5	9.1
Price / Book Value ratio	x	0.3	1.2
Market Cap	Rs m	2,634	11,896
Dividends per share (Unadj.)	Rs	1.7	0.0

Ratio Analysis for RENAISSANCE GLOBAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.3x during FY23, from 1.9x 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 2.9x during FY23, from 4.9x 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 8.6% during FY23, from 11.6% 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 13.7% during FY23, from 17.9% 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 improved and stood at 7.4% during FY23, from 7.1% 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	1.9	2.3
Debtors’ Days	Days	745	727
Interest coverage	x	4.9	2.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.1	7.4
Return on equity	%	11.6	8.6
Return on capital employed	%	17.9	13.7

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

RENAISSANCE GLOBAL Share Price Performance

Over the last one year, RENAISSANCE GLOBAL share price has moved down from Rs 171.7 to Rs 83.4, registering a loss of Rs 88.3 or around 51.4%.

Overall, the S&P BSE SENSEX is up 1.8% over the year.

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