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NIPPON LIFE INDIA AMC 2022-23 Annual Report Analysis

Tue, 20 Jun

NIPPON LIFE INDIA AMC has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

NIPPON LIFE INDIA AMC Income Statement Analysis

• Operating income during the year rose 3.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 0.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 58.8% in FY23 as against 60.5% in FY22.
• Depreciation charges increased by 9.4% and finance costs increased by 3.9% YoY, respectively.
• Other income declined by 27.0% YoY.
• Net profit for the year declined by 2.7% YoY.
• Net profit margins during the year declined from 56.9% in FY22 to 53.6% in FY23.

NIPPON LIFE INDIA AMC Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	13,066	13,498	3.3%
Other income	Rs m	2,295	1,677	-27.0%
Total Revenues	Rs m	15,362	15,175	-1.2%
Gross profit	Rs m	7,902	7,938	0.5%
Depreciation	Rs m	272	298	9.4%
Interest	Rs m	38	40	3.9%
Profit before tax	Rs m	9,887	9,277	-6.2%
Tax	Rs m	2,453	2,048	-16.5%
Profit after tax	Rs m	7,434	7,229	-2.7%
Gross profit margin	%	60.5	58.8
Effective tax rate	%	24.8	22.1
Net profit margin	%	56.9	53.6

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NIPPON LIFE INDIA AMC Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 5.3%.
• Current assets fell 3% and stood at Rs 5 billion, while fixed assets rose 2% and stood at Rs 34 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 39 billion as against Rs 38 billion during FY22, thereby witnessing a growth of 2%.

NIPPON LIFE INDIA AMC Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	33,668	33,891	0.7
Current Liabilities	Rs m	2,280	2,401	5.3
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	37,965	38,609	1.7
Current assets	Rs m	5,107	4,970	-2.7
Fixed Assets	Rs m	32,859	33,639	2.4
Total Assets	Rs m	37,965	38,609	1.7

NIPPON LIFE INDIA AMC Cash Flow Statement Analysis

• NIPPON LIFE INDIA AMC's cash flow from operating activities (CFO) during FY23 stood at Rs 6 billion, an improvement of 0.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -7 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -267 million from the Rs 291 million net cash flows seen during FY22.

NIPPON LIFE INDIA AMC Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	5,796	5,841	0.8%
Cash Flow from Investing Activities	Rs m	-1,245	1,009	-
Cash Flow from Financing Activities	Rs m	-4,259	-7,117	-
Net Cash Flow	Rs m	291	-267	-

Current Valuations for NIPPON LIFE INDIA AMC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.6, an decline from the EPS of Rs 11.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 250.1, stands at 21.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.6 times, while the price to sales ratio stands at 11.5 times.
• The company's price to cash flow (P/CF) ratio stood at 22.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	21.0	21.7
TTM Earnings per share	Rs	11.9	11.6
Diluted earnings per share	Rs	11.9	11.6
Price to Cash Flow	x	28.2	22.9
TTM P/E ratio	x	29.2	21.6
Price / Book Value ratio	x	7.0	5.1
Market Cap	Rs m	236,339	172,729
Dividends per share (Unadj.)	Rs	11.0	11.5

Ratio Analysis for NIPPON LIFE INDIA AMC

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.1x during FY23, from 2.2x during FY22. 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 deteriorated and stood at 234.7x during FY23, from 259.8x during FY22. 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 21.3% during FY23, from 22.1% during FY23. 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 27.5% during FY23, from 29.5% during FY22. 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 18.8% during FY23, from 19.7% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	2.2	2.1
Debtors’ Days	Days	2	3
Interest coverage	x	259.8	234.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	19.7	18.8
Return on equity	%	22.1	21.3
Return on capital employed	%	29.5	27.5

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 268.7 to Rs 250.1, registering a loss of Rs 18.7 or around 6.9%.

Overall, the S&P BSE SENSEX is up 22.4% over the year.

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