SJVN 2017-18 Annual Report Analysis

Sat, 31 Mar

SJVN 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.

SJVN Income Statement Analysis

• Operating income during the year fell 16.8% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 21.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 76.5% in FY18 as against 80.9% in FY17.
• Depreciation charges decreased by 46.4% and finance costs increased by 82.8% YoY, respectively.
• Other income declined by 7.2% YoY.
• Net profit for the year declined by 20.7% YoY.
• Net profit margins during the year declined from 57.5% in FY17 to 54.8% in FY18.

SJVN Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	26,791	22,285	-16.8%
Other income	Rs m	4,383	4,066	-7.2%
Total Revenues	Rs m	31,174	26,351	-15.5%
Gross profit	Rs m	21,679	17,039	-21.4%
Depreciation	Rs m	6,800	3,645	-46.4%
Interest	Rs m	552	1,009	82.8%
Profit before tax	Rs m	18,710	16,451	-12.1%
Tax	Rs m	3,298	4,235	28.4%
Profit after tax	Rs m	15,412	12,216	-20.7%
Gross profit margin	%	80.9	76.5
Effective tax rate	%	17.6	25.7
Net profit margin	%	57.5	54.8

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SJVN Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 29 billion as compared to Rs 25 billion in FY17, thereby witnessing an increase of 14.6%.
• Long-term debt down at Rs 20 billion as compared to Rs 22 billion during FY17, a fall of 8.7%.
• Current assets fell 9% and stood at Rs 65 billion, while fixed assets rose 0% and stood at Rs 96 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 161 billion as against Rs 167 billion during FY17, thereby witnessing a fall of 3%.

SJVN Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	114,896	107,002	-6.9
Current Liabilities	Rs m	25,088	28,757	14.6
Long-term Debt	Rs m	22,295	20,353	-8.7
Total Liabilities	Rs m	166,786	160,975	-3.5
Current assets	Rs m	71,206	65,093	-8.6
Fixed Assets	Rs m	95,580	95,882	0.3
Total Assets	Rs m	166,786	160,975	-3.5

SJVN Cash Flow Statement Analysis

• SJVN's cash flow from operating activities (CFO) during FY18 stood at Rs 16 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs 151 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -23 billion on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -6 billion from the Rs -4 billion net cash flows seen during FY17.

SJVN 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	23,764	16,414	-30.9%
Cash Flow from Investing Activities	Rs m	-11,992	151	-
Cash Flow from Financing Activities	Rs m	-16,213	-22,723	-
Net Cash Flow	Rs m	-4,441	-6,158	-

Current Valuations for SJVN

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.1, an decline from the EPS of Rs 3.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 33.4, stands at 10.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.2 times, while the price to sales ratio stands at 5.9 times.
• The company's price to cash flow (P/CF) ratio stood at 8.7 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	6.5	5.7
TTM Earnings per share	Rs	3.7	3.1
Diluted earnings per share	Rs	3.9	3.1
Price to Cash Flow	x	6.0	8.7
TTM P/E ratio	x	8.1	10.4
Price / Book Value ratio	x	1.1	1.3
Market Cap	Rs m	129,373	137,838
Dividends per share (Unadj.)	Rs	2.8	2.1

Ratio Analysis for SJVN

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.3x during FY18, from 2.8x 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 17.3x during FY18, from 34.9x 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 11.4% during FY18, from 13.4% 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 13.7% during FY18, from 14.0% 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 8.2% during FY18, from 9.6% 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	2.8	2.3
Debtors’ Days	Days	835	473
Interest coverage	x	34.9	17.3
Debt to equity ratio	x	0.2	0.2
Return on assets	%	9.6	8.2
Return on equity	%	13.4	11.4
Return on capital employed	%	14.0	13.7

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

SJVN Share Price Performance

Over the last one year, SJVN share price has moved down from Rs 33.9 to Rs 33.4, registering a loss of Rs 0.5 or around 1.5%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 2,125.8 (down 1.1%). Over the last one year it has moved down from 2,274.4 to 2,125.8, a loss of 149 points (down 6.5%).

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

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

Read: Latest Annual Report Analysis of SJVN