SUDARSHAN CHEMICAL 2022-23 Annual Report Analysis

Sun, 6 Aug

SUDARSHAN CHEMICAL 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.

SUDARSHAN CHEMICAL Income Statement Analysis

• Operating income during the year rose 4.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 23.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 9.3% in FY23 as against 12.6% in FY22.
• Depreciation charges increased by 28.0% and finance costs increased by 94.8% YoY, respectively.
• Other income declined by 4.2% YoY.
• Net profit for the year declined by 65.6% YoY.
• Net profit margins during the year declined from 5.9% in FY22 to 1.9% in FY23.

SUDARSHAN CHEMICAL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	22,008	23,017	4.6%
Other income	Rs m	50	48	-4.2%
Total Revenues	Rs m	22,058	23,065	4.6%
Gross profit	Rs m	2,780	2,132	-23.3%
Depreciation	Rs m	893	1,142	28.0%
Interest	Rs m	226	440	94.8%
Profit before tax	Rs m	1,711	597	-65.1%
Tax	Rs m	412	150	-63.6%
Profit after tax	Rs m	1,300	448	-65.6%
Gross profit margin	%	12.6	9.3
Effective tax rate	%	24.1	25.1
Net profit margin	%	5.9	1.9

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SUDARSHAN CHEMICAL Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 12 billion as compared to Rs 12 billion in FY22, thereby witnessing an decrease of -5.9%.
• Long-term debt stood at Rs 4 billion as compared to Rs 4 billion during FY22, a growth of 21.9%.
• Current assets fell 5% and stood at Rs 13 billion, while fixed assets rose 4% and stood at Rs 14 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 27 billion as against Rs 27 billion during FY22, thereby witnessing a growth of 1%.

SUDARSHAN CHEMICAL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	8,309	8,249	-0.7
Current Liabilities	Rs m	12,326	11,595	-5.9
Long-term Debt	Rs m	3,686	4,492	21.9
Total Liabilities	Rs m	27,202	27,345	0.5
Current assets	Rs m	13,742	13,027	-5.2
Fixed Assets	Rs m	13,460	14,034	4.3
Total Assets	Rs m	27,202	27,345	0.5

SUDARSHAN CHEMICAL Cash Flow Statement Analysis

• SUDARSHAN CHEMICAL's cash flow from operating activities (CFO) during FY23 stood at Rs 3 billion, an improvement of 59.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -49 million from the Rs 93 million net cash flows seen during FY22.

SUDARSHAN CHEMICAL 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	1,796	2,870	59.8%
Cash Flow from Investing Activities	Rs m	-3,080	-1,893	-
Cash Flow from Financing Activities	Rs m	1,378	-1,027	-
Net Cash Flow	Rs m	93	-49	-

Current Valuations for SUDARSHAN CHEMICAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.5, an decline from the EPS of Rs 18.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 527.8, stands at 81.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.4 times, while the price to sales ratio stands at 1.6 times.
• The company's price to cash flow (P/CF) ratio stood at 19.8 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	317.9	332.5
TTM Earnings per share	Rs	18.8	6.5
Diluted earnings per share	Rs	18.8	6.5
Price to Cash Flow	x	16.4	19.8
TTM P/E ratio	x	27.7	81.6
Price / Book Value ratio	x	5.4	3.8
Market Cap	Rs m	44,896	31,466
Dividends per share (Unadj.)	Rs	5.0	1.5

Ratio Analysis for SUDARSHAN CHEMICAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY23, from 1.1x 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 2.4x during FY23, from 8.6x 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 5.4% during FY23, from 15.6% 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 8.1% during FY23, from 16.2% 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 3.2% during FY23, from 5.6% 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	1.1	1.1
Debtors’ Days	Days	830	771
Interest coverage	x	8.6	2.4
Debt to equity ratio	x	0.4	0.5
Return on assets	%	5.6	3.2
Return on equity	%	15.6	5.4
Return on capital employed	%	16.2	8.1

To see how SUDARSHAN CHEMICAL has performed over the last 5 years, please visit here.

SUDARSHAN CHEMICAL Share Price Performance

Over the last one year, SUDARSHAN CHEMICAL share price has moved up from Rs 485.3 to Rs 527.8, registering a gain of Rs 42.5 or around 8.8%.

Overall, the S&P BSE SENSEX is up 12.6% over the year.

(To know more, check out historical annual results for SUDARSHAN CHEMICAL and quarterly results for SUDARSHAN CHEMICAL)