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RELIANCE IND. 2017-18 Annual Report Analysis

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RELIANCE IND. 2017-18 Annual Report Analysis
Wed, 28 Nov

RELIANCE IND. 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.

RELIANCE IND. Income Statement Analysis

  • Operating income during the year rose 34.2% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 23.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 13.8% in FY18 as against 15.0% in FY17.
  • Depreciation charges increased by 43.4% and finance costs increased by 109.2% YoY, respectively.
  • Other income grew by 71.7% YoY.
  • Net profit for the year grew by 20.9% YoY.
  • Net profit margins during the year declined from 9.8% in FY17 to 8.7% in FY18.

RELIANCE IND. Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 2,939,510 3,945,170 34.2%
Other income Rs m 114,310 196,260 71.7%
Total Revenues Rs m 3,053,820 4,141,430 35.6%
Gross profit Rs m 442,060 544,990 23.3%
Depreciation Rs m 116,460 167,060 43.4%
Interest Rs m 38,490 80,520 109.2%
Profit before tax Rs m 401,420 493,670 23.0%
Tax Rs m 102,010 133,460 30.8%
Profit after tax Rs m 298,330 360,800 20.9%
Gross profit margin % 15.0 13.8
Effective tax rate % 25.4 27.0
Net profit margin % 9.8 8.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



RELIANCE IND. Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 3,139 billion as compared to Rs 2,353 billion in FY17, thereby witnessing an increase of 33.4%.
  • Long-term debt down at Rs 1,442 billion as compared to Rs 1,521 billion during FY17, a fall of 5.2%.
  • Current assets rose 25% and stood at Rs 1,838 billion, while fixed assets rose 30% and stood at Rs 5,909 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 8,163 billion as against Rs 7,123 billion during FY17, thereby witnessing a growth of 15%.

RELIANCE IND. Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 2,637,090 2,935,060 11.3
 
Current Liabilities Rs m 2,353,170 3,138,520 33.4
Long-term Debt Rs m 1,521,480 1,441,750 -5.2
Total Liabilities Rs m 7,123,390 8,163,480 14.6
 
Current assets Rs m 1,468,130 1,837,860 25.2
Fixed Assets Rs m 4,550,458 5,909,070 29.9
Total Assets Rs m 7,123,390 8,163,480 14.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



RELIANCE IND. Cash Flow Statement Analysis

  • RELIANCE IND.'s cash flow from operating activities (CFO) during FY18 stood at Rs 715 billion, an improvement of 44.2% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -683 billion, an improvement of 3.0% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -20 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 13 billion from the Rs -80 billion net cash flows seen during FY17.

RELIANCE IND. 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 495,500 714,590 44.2%
Cash Flow from Investing Activities Rs m -662,920 -682,900 -
Cash Flow from Financing Activities Rs m 86,170 -20,010 -
Net Cash Flow Rs m -80,340 12,660 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for RELIANCE IND.

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 60.9, an decline from the EPS of Rs 100.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,133.0, stands at 19.4 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 1.8 times.
  • The company's price to cash flow (P/CF) ratio stood at 14.0 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 993.4 666.2
TTM Earnings per share Rs 100.8 60.9
Diluted earnings per share Rs 45.9 55.5
Price to Cash Flow x 8.1 14.0
TTM P/E ratio x 8.8 19.4
Price / Book Value ratio x 1.3 2.5
Market Cap Rs m 3,352,456 7,368,046
Dividends per share (Unadj.) Rs 11.0 6.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for RELIANCE IND.

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 0.6x during FY18, from 0.6x 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 7.1x during FY18, from 11.4x 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 12.3% during FY18, from 11.3% 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 13.1% during FY18, from 10.6% 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 5.4% during FY18, from 4.7% 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 0.6 0.6
Debtors’ Days Days 10 16
Interest coverage x 11.4 7.1
Debt to equity ratio x 0.6 0.5
Return on assets % 4.7 5.4
Return on equity % 11.3 12.3
Return on capital employed % 10.6 13.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

RELIANCE IND. Share Price Performance

Over the last one year, RELIANCE IND. share price has moved up from Rs 943.0 to Rs 1,133.0, registering a gain of Rs 190.1 or around 20.2%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 13,485.9 (down 0.2%). Over the last one year it has moved down from 16,050.4 to 13,485.9, a loss of 2,565 points (down 16.0%).

Overall, the S&P BSE SENSEX is up 5.8% over the year.

(To know more, check out historical annual results for RELIANCE IND. and quarterly results for RELIANCE IND.)

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Related Views on News

RELIANCE IND. Announces Quarterly Results (3QFY19); Net Profit Up 9.6% (Quarterly Result Update)

Jan 18, 2019 | Updated on Jan 18, 2019

For the quarter ended December 2018, RELIANCE IND. has posted a net profit of Rs 104 bn (up 9.6% YoY). Sales on the other hand came in at Rs 1,603 bn (up 56.4% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

RELIANCE IND. Announces Quarterly Results (2QFY19); Net Profit Up 17.9% (Quarterly Result Update)

Oct 19, 2018 | Updated on Oct 19, 2018

For the quarter ended September 2018, RELIANCE IND. has posted a net profit of Rs 95 bn (up 17.9% YoY). Sales on the other hand came in at Rs 1,460 bn (up 53.6% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

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