RAJRATAN GLOBAL WIRE 2020-21 Annual Report Analysis

Wed, 31 Mar

RAJRATAN GLOBAL WIRE 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.

RAJRATAN GLOBAL WIRE Income Statement Analysis

• Operating income during the year rose 13.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 35.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.9% in FY21 as against 14.2% in FY20.
• Depreciation charges increased by 16.6% and finance costs decreased by 0.1% YoY, respectively.
• Other income grew by 39.3% YoY.
• Net profit for the year grew by 60.8% YoY.
• Net profit margins during the year grew from 6.9% in FY20 to 9.7% in FY21.

RAJRATAN GLOBAL WIRE Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	4,802	5,465	13.8%
Other income	Rs m	12	16	39.3%
Total Revenues	Rs m	4,814	5,482	13.9%
Gross profit	Rs m	680	921	35.4%
Depreciation	Rs m	121	141	16.6%
Interest	Rs m	134	134	-0.1%
Profit before tax	Rs m	437	663	51.6%
Tax	Rs m	107	131	23.1%
Profit after tax	Rs m	331	531	60.8%
Gross profit margin	%	14.2	16.9
Effective tax rate	%	24.4	19.8
Net profit margin	%	6.9	9.7

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RAJRATAN GLOBAL WIRE Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 2 billion as compared to Rs 1 billion in FY20, thereby witnessing an increase of 5.3%.
• Long-term debt stood at Rs 592 million as compared to Rs 536 million during FY20, a growth of 10.5%.
• Current assets rose 35% and stood at Rs 2 billion, while fixed assets rose 6% and stood at Rs 3 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 5 billion as against Rs 4 billion during FY20, thereby witnessing a growth of 17%.

RAJRATAN GLOBAL WIRE Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	1,735	2,265	30.6
Current Liabilities	Rs m	1,469	1,547	5.3
Long-term Debt	Rs m	536	592	10.5
Total Liabilities	Rs m	3,854	4,511	17.1
Current assets	Rs m	1,442	1,948	35.1
Fixed Assets	Rs m	2,411	2,563	6.3
Total Assets	Rs m	3,854	4,511	17.1

RAJRATAN GLOBAL WIRE Cash Flow Statement Analysis

• RAJRATAN GLOBAL WIRE's cash flow from operating activities (CFO) during FY21 stood at Rs 364 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -243 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -96 million on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 26 million from the Rs 0 million net cash flows seen during FY20.

RAJRATAN GLOBAL WIRE 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	514	364	-29.1%
Cash Flow from Investing Activities	Rs m	-449	-243	-
Cash Flow from Financing Activities	Rs m	-65	-96	-
Net Cash Flow	Rs m	0	26	-

Current Valuations for RAJRATAN GLOBAL WIRE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 52.3, an improvement from the EPS of Rs 32.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 784.8, stands at 75.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 17.6 times, while the price to sales ratio stands at 1.5 times.
• The company's price to cash flow (P/CF) ratio stood at 7.9 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	473.1	538.5
TTM Earnings per share	Rs	32.6	52.3
Diluted earnings per share	Rs	6.5	10.5
Price to Cash Flow	x	21.2	7.9
TTM P/E ratio	x	28.9	75.0
Price / Book Value ratio	x	3.3	2.3
Market Cap	Rs m	5,686	5,309
Dividends per share (Unadj.)	Rs	0.4	1.6

Ratio Analysis for RAJRATAN GLOBAL WIRE

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x during FY21, from 1.0x 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 6.0x during FY21, from 4.3x 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 23.5% during FY21, from 19.1% 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 27.9% during FY21, from 25.1% 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 14.7% during FY21, from 12.1% 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	1.0	1.3
Debtors’ Days	Days	636	779
Interest coverage	x	4.3	6.0
Debt to equity ratio	x	0.3	0.3
Return on assets	%	12.1	14.7
Return on equity	%	19.1	23.5
Return on capital employed	%	25.1	27.9

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

RAJRATAN GLOBAL WIRE Share Price Performance

Over the last one year, RAJRATAN GLOBAL WIRE share price has moved up from Rs 188.5 to Rs 784.8, registering a gain of Rs 596.4 or around 316.4%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 14,350.6 (up 0.4%). Over the last one year it has moved up from 5,713.3 to 14,350.6, a gain of 8,637 points (up 151.2%).

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

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

Read: Latest Annual Report Analysis of RAJRATAN GLOBAL WIRE