SALZER ELEC 2022-23 Annual Report Analysis

Mon, 19 Feb

SALZER ELEC 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.

SALZER ELEC Income Statement Analysis

• Operating income during the year rose 29.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 45.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 9.2% in FY23 as against 8.2% in FY22.
• Depreciation charges increased by 1.6% and finance costs increased by 31.4% YoY, respectively.
• Other income declined by 28.1% YoY.
• Net profit for the year grew by 63.7% YoY.
• Net profit margins during the year grew from 3.0% in FY22 to 3.8% in FY23.

SALZER ELEC Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	8,035	10,372	29.1%
Other income	Rs m	28	20	-28.1%
Total Revenues	Rs m	8,063	10,392	28.9%
Gross profit	Rs m	660	956	45.0%
Depreciation	Rs m	163	166	1.6%
Interest	Rs m	199	261	31.4%
Profit before tax	Rs m	325	549	68.9%
Tax	Rs m	83	153	84.0%
Profit after tax	Rs m	242	396	63.7%
Gross profit margin	%	8.2	9.2
Effective tax rate	%	25.5	27.8
Net profit margin	%	3.0	3.8

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SALZER ELEC Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 4 billion as compared to Rs 4 billion in FY22, thereby witnessing an increase of 23.7%.
• Long-term debt down at Rs 78 million as compared to Rs 124 million during FY22, a fall of 37.3%.
• Current assets rose 26% and stood at Rs 6 billion, while fixed assets rose 5% and stood at Rs 3 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 9 billion as against Rs 8 billion during FY22, thereby witnessing a growth of 19%.

SALZER ELEC Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	3,539	3,952	11.7
Current Liabilities	Rs m	3,615	4,472	23.7
Long-term Debt	Rs m	124	78	-37.3
Total Liabilities	Rs m	7,523	8,953	19.0
Current assets	Rs m	4,978	6,278	26.1
Fixed Assets	Rs m	2,545	2,672	5.0
Total Assets	Rs m	7,523	8,953	19.0

SALZER ELEC Cash Flow Statement Analysis

• SALZER ELEC's cash flow from operating activities (CFO) during FY23 stood at Rs 227 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -349 million, an improvement of 116.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 178 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 56 million from the Rs -22 million net cash flows seen during FY22.

SALZER ELEC 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	-122	227	-
Cash Flow from Investing Activities	Rs m	-161	-349	-
Cash Flow from Financing Activities	Rs m	261	178	-31.8%
Net Cash Flow	Rs m	-22	56	-

Current Valuations for SALZER ELEC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 24.5, an improvement from the EPS of Rs 15.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 253.4, stands at 11.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.1 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 7.1 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	502.8	641.0
TTM Earnings per share	Rs	15.1	24.5
Diluted earnings per share	Rs	13.9	22.8
Price to Cash Flow	x	7.9	7.1
TTM P/E ratio	x	13.2	11.1
Price / Book Value ratio	x	0.8	1.0
Market Cap	Rs m	2,986	3,980
Dividends per share (Unadj.)	Rs	1.8	2.2

Ratio Analysis for SALZER ELEC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.4x during FY23, from 1.4x 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 improved and stood at 3.1x during FY23, from 2.6x 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 improved and stood at 10.0% during FY23, from 6.8% 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 improved and stood at 20.1% during FY23, from 14.3% 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 improved and stood at 7.3% during FY23, from 5.9% 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	1.4	1.4
Debtors’ Days	Days	992	1,011
Interest coverage	x	2.6	3.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	5.9	7.3
Return on equity	%	6.8	10.0
Return on capital employed	%	14.3	20.1

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

SALZER ELEC Share Price Performance

Over the last one year, SALZER ELEC share price has moved up from Rs 183.9 to Rs 253.4, registering a gain of Rs 69.5 or around 37.8%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 34,369.7 (up 1.2%). Over the last one year it has moved up from 27,506.0 to 34,369.7, a gain of 6,864 points (up 25.0%).

Overall, the S&P BSE SENSEX is up 1.8% over the year.

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