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RELIANCE IND. 2020-21 Annual Report Analysis
Wed, 31 Mar

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 1.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.7% 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 29.1% YoY.
  • Net profit for the year grew by 33.8% YoY.
  • Net profit margins during the year grew from 7.4% in FY20 to 13.5% 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 132,790 171,420 29.1%
Total Revenues Rs m 5,483,520 4,117,520 -24.9%
Gross profit Rs m 844,500 855,640 1.3%
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 21.7
Effective tax rate % 25.7 3.1
Net profit margin % 7.4 13.5
* 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 2,003.2, stands at 25.5 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 3.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 14.5 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 12.1 14.5
TTM P/E ratio x 18.9 25.5
Price / Book Value ratio x 1.8 1.7
Market Cap Rs m 7,903,482 11,541,330
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 1 2
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 1,112.5 to Rs 2,003.2, registering a gain of Rs 890.8 or around 80.1%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 14,820.5 (down 0.1%). Over the last one year it has moved up from 10,020.9 to 14,820.5, a gain of 4,800 points (up 47.9%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Annual Report FAQs

What is the current share price of RELIANCE IND.?

RELIANCE IND. currently trades at Rs 2,669.7 per share. You can check out the latest share price performance of RELIANCE IND. here...

What was the revenue of RELIANCE IND. in FY21? How does it compare to earlier years?

The revenues of RELIANCE IND. stood at Rs 4,117,520 m in FY21, which was down -24.9% compared to Rs 5,483,520 m reported in FY20.

RELIANCE IND.'s revenue has grown from Rs 2,900,270 m in FY17 to Rs 4,117,520 m in FY21.

Over the past 5 years, the revenue of RELIANCE IND. has grown at a CAGR of 9.2%.

What was the net profit of RELIANCE IND. in FY21? How does it compare to earlier years?

The net profit of RELIANCE IND. stood at Rs 532,230 m in FY21, which was up 33.8% compared to Rs 397,730 m reported in FY20.

This compares to a net profit of Rs 397,340 m in FY19 and a net profit of Rs 360,210 m in FY18.

Over the past 5 years, RELIANCE IND. net profit has grown at a CAGR of 15.5%.

What does the cash flow statement of RELIANCE IND. 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 RELIANCE IND. reveals:

  • Cash flow from operations decreased in FY21 and stood at Rs 261,850 m as compared to Rs 948,770 m in FY20.
  • Cash flow from investments decreased in FY21 and stood at Rs -1,416,340 m as compared to Rs -725,200 m in FY20.
  • Cash flow from financial activity increased in FY21 and stood at Rs 1,019,020 m as compared to Rs -25,410 m in FY20.

Here's the cash flow statement of RELIANCE IND. for the past 5 years.

(Rs m)FY17FY18FY19FY20FY21
From Operations495,500714,590423,460948,770261,850
From Investments-662,920-682,900-951,280-725,200-1,416,340
From Financial Activity86,170-20,010559,060-25,4101,019,020
Net Cashflow-80,34012,66037,450198,390-135,230

What does the Key Ratio analysis of RELIANCE IND. 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 RELIANCE IND. reveals:

  • Operating profit margins witnessed a fall and down at 21.7% in FY21 as against 15.8% in FY20.
  • Net profit margins grew from 7.4% in FY20 to 13.5% in FY21.
  • Debt to Equity ratio for FY21 stood at 0.2 as compared to 0.4 in FY20.

Here's the ratio/financial analysis of RELIANCE IND. for the past 5 years.

 FY17FY18FY19FY20FY21
Operating Profit Margin (%)16.518.216.415.821.7
Net Profit Margin (%)10.710.27.77.413.5
Debt to Equity Ratio (x)0.60.50.50.40.2

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