SADBHAV ENGINEERING 2018-19 Annual Report Analysis

Sun, 31 Mar

SADBHAV ENGINEERING has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

SADBHAV ENGINEERING Income Statement Analysis

• Operating income during the year rose 5.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 4.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 29.3% in FY19 as against 29.7% in FY18.
• Depreciation charges increased by 9.4% and finance costs increased by 1.3% YoY, respectively.
• Other income grew by 122.8% YoY.
• Net profit for the year declined by 52.6% YoY.
• Net profit margins during the year grew from 2.3% in FY18 to 1.0% in FY19.

SADBHAV ENGINEERING Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	49,747	52,401	5.3%
Other income	Rs m	1,188	2,646	122.8%
Total Revenues	Rs m	50,935	55,046	8.1%
Gross profit	Rs m	14,765	15,364	4.1%
Depreciation	Rs m	3,584	3,921	9.4%
Interest	Rs m	13,129	13,298	1.3%
Profit before tax	Rs m	-760	791	-204.0%
Tax	Rs m	380	1,332	250.6%
Profit after tax	Rs m	-1,140	-541	-52.6%
Gross profit margin	%	29.7	29.3
Effective tax rate	%	-50.0	168.4
Net profit margin	%	-2.3	-1.0

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SADBHAV ENGINEERING Balance Sheet Analysis

• The company's current liabilities during FY19 down at Rs 35 billion as compared to Rs 36 billion in FY18, thereby witnessing an decrease of -1.0%.
• Long-term debt stood at Rs 97 billion as compared to Rs 84 billion during FY18, a growth of 14.8%.
• Current assets fell 11% and stood at Rs 36 billion, while fixed assets rose 17% and stood at Rs 125 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 162 billion as against Rs 148 billion during FY18, thereby witnessing a growth of 9%.

SADBHAV ENGINEERING Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	8,913	8,350	-6.3
Current Liabilities	Rs m	35,633	35,283	-1.0
Long-term Debt	Rs m	84,357	96,827	14.8
Total Liabilities	Rs m	148,277	161,748	9.1
Current assets	Rs m	40,886	36,315	-11.2
Fixed Assets	Rs m	107,391	125,432	16.8
Total Assets	Rs m	148,277	161,748	9.1

SADBHAV ENGINEERING Cash Flow Statement Analysis

• SADBHAV ENGINEERING's cash flow from operating activities (CFO) during FY19 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -37 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -2 billion, an improvement of 80% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 151 million from the Rs 533 million net cash flows seen during FY18.

SADBHAV ENGINEERING Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	12,735	2,448	-80.8%
Cash Flow from Investing Activities	Rs m	-942	-37	-
Cash Flow from Financing Activities	Rs m	-11,260	-2,260	-
Net Cash Flow	Rs m	533	151	-71.6%

Current Valuations for SADBHAV ENGINEERING

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -3.2, an improvement from the EPS of Rs -6.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 249.2, stands at 22.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.1 times, while the price to sales ratio stands at 0.8 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-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	290.0	305.4
TTM Earnings per share	Rs	-6.6	-3.2
Diluted earnings per share	Rs	-6.6	-3.2
Price to Cash Flow	x	27.8	14.5
TTM P/E ratio	x	30.8	22.9
Price / Book Value ratio	x	6.7	5.9
Market Cap	Rs m	60,123	48,859
Dividends per share (Unadj.)	Rs	1.0	1.0

Ratio Analysis for SADBHAV ENGINEERING

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.0x during FY19, from 1.1x during FY18. 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 1.1x during FY19, from 0.9x during FY18. 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 -6.5% during FY19, from -12.8% during FY19. 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 13.4% during FY19, from 13.3% during FY18. 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 7.9% during FY19, from 8.1% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	1.1	1.0
Debtors’ Days	Days	1,022	765
Interest coverage	x	0.9	1.1
Debt to equity ratio	x	9.5	11.6
Return on assets	%	8.1	7.9
Return on equity	%	-12.8	-6.5
Return on capital employed	%	13.3	13.4

To see how SADBHAV ENGINEERING has performed over the last 5 years, please visit here.

SADBHAV ENGINEERING Share Price Performance

Over the last one year, SADBHAV ENGINEERING share price has moved down from Rs 395.6 to Rs 249.2, registering a loss of Rs 146.4 or around 37.0%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,472.0 (up 0.5%). Over the last one year it has moved down from 18,476.7 to 18,472.0, a loss of 5 points (down 0.0%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

(To know more, check out historical annual results for SADBHAV ENGINEERING and quarterly results for SADBHAV ENGINEERING)

Read: Latest Annual Report Analysis of SADBHAV ENGINEERING