SKY INDUSTRIES 2022-23 Annual Report Analysis

Wed, 14 Jun

SKY INDUSTRIES 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.

SKY INDUSTRIES Income Statement Analysis

• Operating income during the year rose 6.7% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 40.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.1% in FY23 as against 12.6% in FY22.
• Depreciation charges decreased by 10.2% and finance costs increased by 26.4% YoY, respectively.
• Other income declined by 63.3% YoY.
• Net profit for the year declined by 63.7% YoY.
• Net profit margins during the year declined from 6.9% in FY22 to 2.4% in FY23.

SKY INDUSTRIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	702	749	6.7%
Other income	Rs m	9	3	-63.3%
Total Revenues	Rs m	711	752	5.8%
Gross profit	Rs m	89	53	-40.0%
Depreciation	Rs m	19	17	-10.2%
Interest	Rs m	13	16	26.4%
Profit before tax	Rs m	66	23	-64.4%
Tax	Rs m	17	6	-66.5%
Profit after tax	Rs m	49	18	-63.7%
Gross profit margin	%	12.6	7.1
Effective tax rate	%	25.8	24.3
Net profit margin	%	6.9	2.4

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SKY INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 210 million as compared to Rs 220 million in FY22, thereby witnessing an decrease of -4.2%.
• Long-term debt down at Rs 3 million as compared to Rs 10 million during FY22, a fall of 65.5%.
• Current assets rose 3% and stood at Rs 431 million, while fixed assets rose 3% and stood at Rs 178 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 610 million as against Rs 591 million during FY22, thereby witnessing a growth of 3%.

SKY INDUSTRIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	319	360	12.6
Current Liabilities	Rs m	220	210	-4.2
Long-term Debt	Rs m	10	3	-65.5
Total Liabilities	Rs m	591	610	3.1
Current assets	Rs m	419	431	3.0
Fixed Assets	Rs m	172	178	3.5
Total Assets	Rs m	591	610	3.1

SKY INDUSTRIES Cash Flow Statement Analysis

• SKY INDUSTRIES's cash flow from operating activities (CFO) during FY23 stood at Rs 18 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -8 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -9 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 2 million from the Rs -12 million net cash flows seen during FY22.

SKY INDUSTRIES 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	-19	18	-
Cash Flow from Investing Activities	Rs m	-27	-8	-
Cash Flow from Financing Activities	Rs m	34	-9	-
Net Cash Flow	Rs m	-12	2	-

Current Valuations for SKY INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.2, an decline from the EPS of Rs 7.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 62.8, stands at 28.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.4 times, while the price to sales ratio stands at 0.7 times.
• The company's price to cash flow (P/CF) ratio stood at 20.2 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	102.5	95.3
TTM Earnings per share	Rs	7.1	2.2
Diluted earnings per share	Rs	6.2	2.2
Price to Cash Flow	x	8.0	20.2
TTM P/E ratio	x	11.1	28.0
Price / Book Value ratio	x	1.7	1.9
Market Cap	Rs m	538	700
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for SKY INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.1x during FY23, from 1.9x 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 2.5x during FY23, from 6.2x 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 4.9% during FY23, from 15.3% 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 10.8% during FY23, from 23.8% 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 5.5% during FY23, from 10.4% 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	1.9	2.1
Debtors’ Days	Days	628	598
Interest coverage	x	6.2	2.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	10.4	5.5
Return on equity	%	15.3	4.9
Return on capital employed	%	23.8	10.8

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

SKY INDUSTRIES Share Price Performance

Over the last one year, SKY INDUSTRIES share price has moved down from Rs 75.6 to Rs 62.8, registering a loss of Rs 12.8 or around 17.0%.

Overall, the S&P BSE SENSEX is up 19.3% over the year.

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