SANGAM INDIA 2017-18 Annual Report Analysis

Sat, 31 Mar

SANGAM INDIA has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

SANGAM INDIA 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 28.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.7% in FY18 as against 11.2% in FY17.
• Depreciation charges increased by 6.2% and finance costs decreased by 2.9% YoY, respectively.
• Other income grew by 3.0% YoY.
• Net profit for the year declined by 45.9% YoY.
• Net profit margins during the year declined from 3.4% in FY17 to 1.8% in FY18.

SANGAM INDIA Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	15,547	16,261	4.6%
Other income	Rs m	245	252	3.0%
Total Revenues	Rs m	15,792	16,514	4.6%
Gross profit	Rs m	1,736	1,247	-28.2%
Depreciation	Rs m	726	771	6.2%
Interest	Rs m	647	628	-2.9%
Profit before tax	Rs m	608	100	-83.5%
Tax	Rs m	78	-186	-337.5%
Profit after tax	Rs m	529	286	-45.9%
Gross profit margin	%	11.2	7.7
Effective tax rate	%	12.9	-186.2
Net profit margin	%	3.4	1.8

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SANGAM INDIA Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 7 billion as compared to Rs 6 billion in FY17, thereby witnessing an increase of 20.4%.
• Long-term debt stood at Rs 3 billion as compared to Rs 3 billion during FY17, a growth of 5.3%.
• Current assets rose 15% and stood at Rs 9 billion, while fixed assets rose 6% and stood at Rs 7 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 16 billion as against Rs 14 billion during FY17, thereby witnessing a growth of 11%.

SANGAM INDIA Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	4,919	5,118	4.0
Current Liabilities	Rs m	5,652	6,808	20.4
Long-term Debt	Rs m	3,271	3,443	5.3
Total Liabilities	Rs m	14,284	15,798	10.6
Current assets	Rs m	7,388	8,505	15.1
Fixed Assets	Rs m	6,896	7,292	5.7
Total Assets	Rs m	14,284	15,798	10.6

SANGAM INDIA Cash Flow Statement Analysis

• SANGAM INDIA's cash flow from operating activities (CFO) during FY18 stood at Rs 953 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs 76 million, an improvement of 153% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -40 million from the Rs 21 million net cash flows seen during FY17.

SANGAM INDIA Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	1,475	953	-35.4%
Cash Flow from Investing Activities	Rs m	-1,312	-1,068	-
Cash Flow from Financing Activities	Rs m	-142	76	-
Net Cash Flow	Rs m	21	-40	-

Current Valuations for SANGAM INDIA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.3, an decline from the EPS of Rs 13.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 119.5, stands at 17.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.0 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at 8.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	394.4	412.5
TTM Earnings per share	Rs	13.4	7.3
Diluted earnings per share	Rs	12.2	6.6
Price to Cash Flow	x	9.5	8.2
TTM P/E ratio	x	22.0	17.0
Price / Book Value ratio	x	2.2	1.7
Market Cap	Rs m	10,841	8,716
Dividends per share (Unadj.)	Rs	2.0	1.0

Ratio Analysis for SANGAM INDIA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x during FY18, from 1.3x during FY17. 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 1.2x during FY18, from 1.9x during FY17. 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 5.6% during FY18, from 10.8% during FY18. 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 8.5% during FY18, from 15.3% during FY17. 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 5.8% during FY18, from 8.2% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	1.3	1.2
Debtors’ Days	Days	599	714
Interest coverage	x	1.9	1.2
Debt to equity ratio	x	0.7	0.7
Return on assets	%	8.2	5.8
Return on equity	%	10.8	5.6
Return on capital employed	%	15.3	8.5

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

SANGAM INDIA Share Price Performance

Over the last one year, SANGAM INDIA share price has moved down from Rs 276.1 to Rs 119.5, registering a loss of Rs 156.6 or around 56.7%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of SANGAM INDIA