VEDANTA 2020-21 Annual Report Analysis

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VEDANTA 2020-21 Annual Report Analysis
Mon, 18 Oct

VEDANTA 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.

VEDANTA Income Statement Analysis

  • Operating income during the year rose 4.2% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 707.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 30.3% in FY21 as against 3.9% in FY20.
  • Depreciation charges decreased by 16.0% and finance costs increased by 4.7% YoY, respectively.
  • Other income grew by 36.3% YoY.
  • Net profit for the year declined by 417.0% YoY.
  • Net profit margins during the year grew from 5.5% in FY20 to 16.4% in FY21.

VEDANTA Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 844,470 880,210 4.2%
Other income Rs m 25,100 34,210 36.3%
Total Revenues Rs m 869,570 914,420 5.2%
Gross profit Rs m 33,010 266,400 707.0%
Depreciation Rs m 90,930 76,380 -16.0%
Interest Rs m 49,770 52,100 4.7%
Profit before tax Rs m -82,590 172,130 -308.4%
Tax Rs m -35,160 21,800 -162.0%
Profit after tax Rs m -47,430 150,330 -417.0%
Gross profit margin % 3.9 30.3
Effective tax rate % 42.6 12.7
Net profit margin % -5.5 16.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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VEDANTA Balance Sheet Analysis

  • The company's current liabilities during FY21 down at Rs 591 billion as compared to Rs 633 billion in FY20, thereby witnessing an decrease of -6.6%.
  • Long-term debt stood at Rs 380 billion as compared to Rs 367 billion during FY20, a growth of 3.4%.
  • Current assets fell 2% and stood at Rs 562 billion, while fixed assets rose 4% and stood at Rs 1,236 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 1,798 billion as against Rs 1,767 billion during FY20, thereby witnessing a growth of 2%.

VEDANTA Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 543,860 621,070 14.2
 
Current Liabilities Rs m 633,220 591,240 -6.6
Long-term Debt Rs m 367,240 379,620 3.4
Total Liabilities Rs m 1,767,330 1,798,370 1.8
 
Current assets Rs m 575,200 561,920 -2.3
Fixed Assets Rs m 1,192,130 1,236,450 3.7
Total Assets Rs m 1,767,330 1,798,370 1.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



VEDANTA Cash Flow Statement Analysis

  • VEDANTA's cash flow from operating activities (CFO) during FY21 stood at Rs 240 billion, an improvement of 24.2% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -68 billion, an improvement of 14.5% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -176 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -3 billion from the Rs -22 billion net cash flows seen during FY20.

VEDANTA 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 193,000 239,800 24.2%
Cash Flow from Investing Activities Rs m -58,940 -67,500 -
Cash Flow from Financing Activities Rs m -155,470 -175,650 -
Net Cash Flow Rs m -21,720 -2,630 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for VEDANTA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 40.4, an improvement from the EPS of Rs -12.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 373.0, stands at 7.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.9 times, while the price to sales ratio stands at 0.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 6.1 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 227.0 236.6
TTM Earnings per share Rs -12.8 40.4
Diluted earnings per share Rs -12.8 40.4
Price to Cash Flow x 31.9 6.1
TTM P/E ratio x 7.4 7.4
Price / Book Value ratio x 0.9 0.9
Market Cap Rs m 1,387,374 1,386,328
Dividends per share (Unadj.) Rs 3.9 9.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for VEDANTA

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.0x during FY21, from 0.9x 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 4.3x during FY21, from -0.7x 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 24.2% during FY21, from -8.7% 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 22.4% during FY21, from -3.6% 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 11.3% during FY21, from 0.1% 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 0.9 1.0
Debtors’ Days Days 1 1
Interest coverage x -0.7 4.3
Debt to equity ratio x 0.7 0.6
Return on assets % 0.1 11.3
Return on equity % -8.7 24.2
Return on capital employed % -3.6 22.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

VEDANTA Share Price Performance

Over the last one year, VEDANTA share price has moved up from Rs 95.0 to Rs 373.0, registering a gain of Rs 278.0 or around 292.6%.

Overall, the S&P BSE SENSEX is up 52.5% over the year.

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

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Related Views on News

VEDANTA Announces Quarterly Results (3QFY21); Net Profit Up 58.5% (Quarterly Result Update)

Feb 1, 2021 | Updated on Feb 1, 2021

For the quarter ended December 2020, VEDANTA has posted a net profit of Rs 42 bn (up 58.5% YoY). Sales on the other hand came in at Rs 225 bn (up 5.3% YoY). Read on for a complete analysis of VEDANTA's quarterly results.

VEDANTA 2019-20 Annual Report Analysis (Annual Result Update)

Dec 11, 2020 | Updated on Dec 11, 2020

Here's an analysis of the annual report of VEDANTA for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of VEDANTA. Also includes updates on the valuation of VEDANTA.

VEDANTA LTD Announces Quarterly Results (3QFY20); Net Profit Up 14.3% (Quarterly Result Update)

Feb 3, 2020 | Updated on Feb 3, 2020

For the quarter ended December 2019, VEDANTA LTD has posted a net profit of Rs 27 bn (up 14.3% YoY). Sales on the other hand came in at Rs 214 bn (down 9.8% YoY). Read on for a complete analysis of VEDANTA LTD's quarterly results.

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