RELIANCE IND. 2020-21 Annual Report Analysis

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RELIANCE IND. 2020-21 Annual Report Analysis
Mon, 18 Oct

RELIANCE IND. has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

RELIANCE IND. Income Statement Analysis

  • Operating income during the year fell 26.3% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 2.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.9% in FY21 as against 15.8% in FY20.
  • Depreciation charges increased by 19.7% and finance costs decreased by 3.8% YoY, respectively.
  • Other income grew by 23.7% YoY.
  • Net profit for the year grew by 33.8% YoY.
  • Net profit margins during the year grew from 7.3% in FY20 to 12.9% in FY21.

RELIANCE IND. Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 5,350,730 3,946,100 -26.3%
Other income Rs m 132,790 164,290 23.7%
Total Revenues Rs m 5,483,520 4,110,390 -25.0%
Gross profit Rs m 844,500 862,770 2.2%
Depreciation Rs m 222,030 265,720 19.7%
Interest Rs m 220,270 211,890 -3.8%
Profit before tax Rs m 534,990 549,450 2.7%
Tax Rs m 137,260 17,220 -87.5%
Profit after tax Rs m 397,730 532,230 33.8%
Gross profit margin % 15.8 21.9
Effective tax rate % 25.7 3.1
Net profit margin % 7.3 12.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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RELIANCE IND. Balance Sheet Analysis

  • The company's current liabilities during FY21 down at Rs 2,776 billion as compared to Rs 4,129 billion in FY20, thereby witnessing an decrease of -32.8%.
  • Long-term debt down at Rs 1,637 billion as compared to Rs 1,976 billion during FY20, a fall of 17.2%.
  • Current assets rose 44% and stood at Rs 3,730 billion, while fixed assets rose 5% and stood at Rs 9,471 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 13,201 billion as against Rs 11,630 billion during FY20, thereby witnessing a growth of 14%.

RELIANCE IND. Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 4,491,470 6,994,350 55.7
 
Current Liabilities Rs m 4,129,160 2,775,680 -32.8
Long-term Debt Rs m 1,976,310 1,636,830 -17.2
Total Liabilities Rs m 11,630,150 13,200,650 13.5
 
Current assets Rs m 2,582,600 3,730,110 44.4
Fixed Assets Rs m 9,047,550 9,470,540 4.7
Total Assets Rs m 11,630,150 13,200,650 13.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



RELIANCE IND. Cash Flow Statement Analysis

  • RELIANCE IND.'s cash flow from operating activities (CFO) during FY21 stood at Rs 262 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -1,416 billion, an improvement of 95.3% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs 1,019 billion, an improvement of 4,110% on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -135 billion from the Rs 198 billion net cash flows seen during FY20.

RELIANCE IND. Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m 948,770 261,850 -72.4%
Cash Flow from Investing Activities Rs m -725,200 -1,416,340 -
Cash Flow from Financing Activities Rs m -25,410 1,019,020 -
Net Cash Flow Rs m 198,390 -135,230 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for RELIANCE IND.

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 78.7, an improvement from the EPS of Rs 62.7 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 2,724.2, stands at 34.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.7 times, while the price to sales ratio stands at 2.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 23.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 844.1 583.6
TTM Earnings per share Rs 62.7 78.7
Diluted earnings per share Rs 58.8 78.7
Price to Cash Flow x 27.9 23.1
TTM P/E ratio x 31.9 34.0
Price / Book Value ratio x 1.8 1.7
Market Cap Rs m 17,269,116 18,420,893
Dividends per share (Unadj.) Rs 6.5 7.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for RELIANCE IND.

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.3x during FY21, from 0.6x during FY20. 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 improved and stood at 3.6x during FY21, from 3.4x during FY20. 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 7.6% during FY21, from 8.9% during FY21. 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 8.8% during FY21, from 11.7% during FY20. 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 5.6% during FY21, from 5.3% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 0.6 1.3
Debtors’ Days Days 13 18
Interest coverage x 3.4 3.6
Debt to equity ratio x 0.4 0.2
Return on assets % 5.3 5.6
Return on equity % 8.9 7.6
Return on capital employed % 11.7 8.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, 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 2,175.5 to Rs 2,724.2, registering a gain of Rs 548.7 or around 25.2%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 19,512.7 (up 1.5%). Over the last one year it has moved up from 11,905.3 to 19,512.7, a gain of 7,607 points (up 63.9%).

Overall, the S&P BSE SENSEX is up 52.4% 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 (2QFY22); Net Profit Up 47.1% (Quarterly Result Update)

Oct 26, 2021 | Updated on Oct 26, 2021

For the quarter ended September 2021, RELIANCE IND. has posted a net profit of Rs 154 bn (up 47.1% YoY). Sales on the other hand came in at Rs 1,741 bn (up 49.8% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

RELIANCE IND. Announces Quarterly Results (1QFY22); Net Profit Up 7.1% (Quarterly Result Update)

Jul 26, 2021 | Updated on Jul 26, 2021

For the quarter ended June 2021, RELIANCE IND. has posted a net profit of Rs 138 bn (up 7.1% YoY). Sales on the other hand came in at Rs 1,444 bn (up 58.2% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

RELIANCE IND. 2020-21 Annual Report Analysis (Annual Result Update)

Jul 8, 2021 | Updated on Jul 8, 2021

Here's an analysis of the annual report of RELIANCE IND. for 2020-21. It includes a full income statement, balance sheet and cash flow analysis of RELIANCE IND.. Also includes updates on the valuation of RELIANCE IND..

RELIANCE IND. 2019-20 Annual Report Analysis (Annual Result Update)

Aug 5, 2020 | Updated on Aug 5, 2020

Here's an analysis of the annual report of RELIANCE IND. for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of RELIANCE IND.. Also includes updates on the valuation of RELIANCE IND..

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