S H KELKAR & CO. 2022-23 Annual Report Analysis

Fri, 25 Aug

S H KELKAR & CO. 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.

S H KELKAR & CO. Income Statement Analysis

• Operating income during the year rose 7.8% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 4.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 11.4% in FY23 as against 12.9% in FY22.
• Depreciation charges increased by 12.1% and finance costs increased by 47.7% YoY, respectively.
• Other income declined by 9.1% YoY.
• Net profit for the year declined by 57.9% YoY.
• Net profit margins during the year declined from 9.6% in FY22 to 3.7% in FY23.

S H KELKAR & CO. Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	15,642	16,865	7.8%
Other income	Rs m	183	166	-9.1%
Total Revenues	Rs m	15,825	17,032	7.6%
Gross profit	Rs m	2,019	1,921	-4.9%
Depreciation	Rs m	718	805	12.1%
Interest	Rs m	162	239	47.7%
Profit before tax	Rs m	1,323	1,044	-21.1%
Tax	Rs m	-172	414	NA
Profit after tax	Rs m	1,494	630	-57.9%
Gross profit margin	%	12.9	11.4
Effective tax rate	%	-13.0	39.7
Net profit margin	%	9.6	3.7

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S H KELKAR & CO. Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 7 billion as compared to Rs 7 billion in FY22, thereby witnessing an decrease of -2.2%.
• Long-term debt down at Rs 3 billion as compared to Rs 4 billion during FY22, a fall of 12.2%.
• Current assets fell 2% and stood at Rs 12 billion, while fixed assets fell 5% and stood at Rs 10 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 22 billion as against Rs 23 billion during FY22, thereby witnessing a fall of 3%.

S H KELKAR & CO. Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	10,133	10,644	5.0
Current Liabilities	Rs m	7,250	7,087	-2.2
Long-term Debt	Rs m	3,630	3,189	-12.2
Total Liabilities	Rs m	22,791	22,018	-3.4
Current assets	Rs m	12,323	12,065	-2.1
Fixed Assets	Rs m	10,469	9,953	-4.9
Total Assets	Rs m	22,791	22,018	-3.4

S H KELKAR & CO. Cash Flow Statement Analysis

• S H KELKAR & CO.'s cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 291.9% 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 -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -882 million from the Rs -714 million net cash flows seen during FY22.

S H KELKAR & CO. 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	502	1,967	291.9%
Cash Flow from Investing Activities	Rs m	-1,597	-1,029	-
Cash Flow from Financing Activities	Rs m	123	-1,748	-
Net Cash Flow	Rs m	-714	-882	-

Current Valuations for S H KELKAR & CO.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.5, an decline from the EPS of Rs 10.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 156.3, stands at 32.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 1.3 times.
• The company's price to cash flow (P/CF) ratio stood at 12.0 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	113.0	121.8
TTM Earnings per share	Rs	10.8	4.5
Diluted earnings per share	Rs	10.8	4.5
Price to Cash Flow	x	9.0	12.0
TTM P/E ratio	x	13.3	32.0
Price / Book Value ratio	x	2.2	1.6
Market Cap	Rs m	21,964	17,192
Dividends per share (Unadj.)	Rs	0.8	2.0

Ratio Analysis for S H KELKAR & CO.

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.7x during FY23, from 1.7x 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 5.4x during FY23, from 9.2x 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 5.9% during FY23, from 14.7% 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 9.3% during FY23, from 10.8% 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 3.9% during FY23, from 7.3% 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	1.7	1.7
Debtors’ Days	Days	11	9
Interest coverage	x	9.2	5.4
Debt to equity ratio	x	0.4	0.3
Return on assets	%	7.3	3.9
Return on equity	%	14.7	5.9
Return on capital employed	%	10.8	9.3

To see how S H KELKAR & CO. has performed over the last 5 years, please visit here.

S H KELKAR & CO. Share Price Performance

Over the last one year, S H KELKAR & CO. share price has moved up from Rs 142.4 to Rs 156.3, registering a gain of Rs 13.9 or around 9.8%.

Overall, the S&P BSE SENSEX is up 9.9% over the year.

(To know more, check out historical annual results for S H KELKAR & CO. and quarterly results for S H KELKAR & CO.)