RELAXO FOOTWEARS 2020-21 Annual Report Analysis

Wed, 31 Mar

RELAXO FOOTWEARS 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.

RELAXO FOOTWEARS Income Statement Analysis

• Operating income during the year fell 2.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 20.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.1% in FY21 as against 17.1% in FY20.
• Depreciation charges increased by 0.5% and finance costs decreased by 3.4% YoY, respectively.
• Other income grew by 151.6% YoY.
• Net profit for the year grew by 28.9% YoY.
• Net profit margins during the year grew from 9.4% in FY20 to 12.4% in FY21.

RELAXO FOOTWEARS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	24,105	23,592	-2.1%
Other income	Rs m	91	228	151.6%
Total Revenues	Rs m	24,195	23,819	-1.6%
Gross profit	Rs m	4,114	4,971	20.8%
Depreciation	Rs m	1,094	1,100	0.5%
Interest	Rs m	193	187	-3.4%
Profit before tax	Rs m	2,917	3,912	34.1%
Tax	Rs m	655	996	52.2%
Profit after tax	Rs m	2,263	2,916	28.9%
Gross profit margin	%	17.1	21.1
Effective tax rate	%	22.4	25.5
Net profit margin	%	9.4	12.4

Don't Miss: Best Chance to Access Midcap Stocks Research at 80% OFF

RELAXO FOOTWEARS Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 4 billion as compared to Rs 4 billion in FY20, thereby witnessing an increase of 8.7%.
• Current assets rose 36% and stood at Rs 11 billion, while fixed assets rose 4% and stood at Rs 11 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 22 billion as against Rs 18 billion during FY20, thereby witnessing a growth of 18%.

RELAXO FOOTWEARS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	12,641	15,651	23.8
Current Liabilities	Rs m	4,133	4,491	8.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	18,411	21,758	18.2
Current assets	Rs m	7,912	10,799	36.5
Fixed Assets	Rs m	10,499	10,959	4.4
Total Assets	Rs m	18,411	21,758	18.2

RELAXO FOOTWEARS Cash Flow Statement Analysis

• RELAXO FOOTWEARS's cash flow from operating activities (CFO) during FY21 stood at Rs 5 billion, an improvement of 60.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -5 billion, an improvement of 291.8% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -562 million, an improvement of 72% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 38 million from the Rs 7 million net cash flows seen during FY20.

RELAXO FOOTWEARS 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	3,189	5,131	60.9%
Cash Flow from Investing Activities	Rs m	-1,157	-4,532	-
Cash Flow from Financing Activities	Rs m	-2,026	-562	-
Net Cash Flow	Rs m	7	38	465.7%

Current Valuations for RELAXO FOOTWEARS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.7, an improvement from the EPS of Rs 9.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 874.2, stands at 74.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 13.9 times, while the price to sales ratio stands at 9.2 times.
• The company's price to cash flow (P/CF) ratio stood at 46.3 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	97.1	95.0
TTM Earnings per share	Rs	9.1	11.7
Diluted earnings per share	Rs	9.1	11.7
Price to Cash Flow	x	44.3	46.3
TTM P/E ratio	x	65.7	74.6
Price / Book Value ratio	x	13.3	11.9
Market Cap	Rs m	167,616	186,040
Dividends per share (Unadj.)	Rs	1.3	2.5

Ratio Analysis for RELAXO FOOTWEARS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.4x during FY21, from 1.9x 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 21.9x during FY21, from 16.1x 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 improved and stood at 18.6% during FY21, from 17.9% 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 improved and stood at 26.2% during FY21, from 24.6% 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 14.3% during FY21, from 13.3% 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	1.9	2.4
Debtors’ Days	Days	3	3
Interest coverage	x	16.1	21.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	13.3	14.3
Return on equity	%	17.9	18.6
Return on capital employed	%	24.6	26.2

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

RELAXO FOOTWEARS Share Price Performance

Over the last one year, RELAXO FOOTWEARS share price has moved up from Rs 597.2 to Rs 874.2, registering a gain of Rs 277.0 or around 46.4%.

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

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

Read: Latest Annual Report Analysis of RELAXO FOOTWEARS