NIPPON LIFE INDIA AMC 2021-22 Annual Report Analysis

Wed, 22 Jun

NIPPON LIFE INDIA AMC has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

NIPPON LIFE INDIA AMC Income Statement Analysis

• Operating income during the year rose 23.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 41.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 60.5% in FY22 as against 52.5% in FY21.
• Depreciation charges decreased by 18.2% and finance costs decreased by 13.8% YoY, respectively.
• Other income declined by 35.7% YoY.
• Net profit for the year grew by 9.4% YoY.
• Net profit margins during the year declined from 64.0% in FY21 to 56.9% in FY22.

NIPPON LIFE INDIA AMC Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	10,621	13,066	23.0%
Other income	Rs m	3,572	2,295	-35.7%
Total Revenues	Rs m	14,193	15,362	8.2%
Gross profit	Rs m	5,575	7,902	41.7%
Depreciation	Rs m	333	272	-18.2%
Interest	Rs m	44	38	-13.8%
Profit before tax	Rs m	8,770	9,887	12.7%
Tax	Rs m	1,976	2,453	24.1%
Profit after tax	Rs m	6,794	7,434	9.4%
Gross profit margin	%	52.5	60.5
Effective tax rate	%	22.5	24.8
Net profit margin	%	64.0	56.9

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NIPPON LIFE INDIA AMC Balance Sheet Analysis

• The company's current liabilities during FY22 down at Rs 2 billion as compared to Rs 2 billion in FY21, thereby witnessing an decrease of -3.9%.
• Current assets rose 3% and stood at Rs 5 billion, while fixed assets rose 13% and stood at Rs 33 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 38 billion as against Rs 34 billion during FY21, thereby witnessing a growth of 12%.

NIPPON LIFE INDIA AMC Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	30,091	33,668	11.9
Current Liabilities	Rs m	2,371	2,280	-3.9
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	33,922	37,965	11.9
Current assets	Rs m	4,950	5,107	3.2
Fixed Assets	Rs m	28,973	32,859	13.4
Total Assets	Rs m	33,922	37,965	11.9

NIPPON LIFE INDIA AMC Cash Flow Statement Analysis

• NIPPON LIFE INDIA AMC's cash flow from operating activities (CFO) during FY22 stood at Rs 6 billion, an improvement of 27.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -4 billion on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 291 million from the Rs -2 billion net cash flows seen during FY21.

NIPPON LIFE INDIA AMC Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	4,560	5,796	27.1%
Cash Flow from Investing Activities	Rs m	-4,016	-1,245	-
Cash Flow from Financing Activities	Rs m	-2,391	-4,259	-
Net Cash Flow	Rs m	-1,848	291	-

Current Valuations for NIPPON LIFE INDIA AMC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 12.0, an improvement from the EPS of Rs 11.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 266.3, stands at 22.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.9 times, while the price to sales ratio stands at 12.7 times.
• The company's price to cash flow (P/CF) ratio stood at 30.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	17.2	21.0
TTM Earnings per share	Rs	11.0	12.0
Diluted earnings per share	Rs	10.9	11.9
Price to Cash Flow	x	29.5	30.6
TTM P/E ratio	x	31.0	22.3
Price / Book Value ratio	x	6.0	7.0
Market Cap	Rs m	180,174	235,900
Dividends per share (Unadj.)	Rs	8.0	11.0

Ratio Analysis for NIPPON LIFE INDIA AMC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.2x during FY22, from 2.1x during FY21. 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 259.8x during FY22, from 199.0x during FY21. 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 22.1% during FY22, from 22.6% during FY22. 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 29.5% during FY22, from 29.3% during FY21. 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 declined and down at 19.7% during FY22, from 20.2% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	2.1	2.2
Debtors’ Days	Days	2	2
Interest coverage	x	199.0	259.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	20.2	19.7
Return on equity	%	22.6	22.1
Return on capital employed	%	29.3	29.5

To see how NIPPON LIFE INDIA AMC has performed over the last 5 years, please visit here.

NIPPON LIFE INDIA AMC Share Price Performance

Over the last one year, NIPPON LIFE INDIA AMC share price has moved down from Rs 357.7 to Rs 266.3, registering a loss of Rs 91.4 or around 25.6%.

Overall, the S&P BSE SENSEX is down 1.4% over the year.

(To know more, check out historical annual results for NIPPON LIFE INDIA AMC and quarterly results for NIPPON LIFE INDIA AMC)

Read: Latest Annual Report Analysis of NIPPON LIFE INDIA AMC