SUNDRAM FASTENERS 2020-21 Annual Report Analysis

Wed, 31 Mar

SUNDRAM FASTENERS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

SUNDRAM FASTENERS Income Statement Analysis

• Operating income during the year fell 2.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 12.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.2% in FY21 as against 15.9% in FY20.
• Depreciation charges increased by 5.7% and finance costs decreased by 54.9% YoY, respectively.
• Other income declined by 2.5% YoY.
• Net profit for the year grew by 11.1% YoY.
• Net profit margins during the year grew from 8.8% in FY20 to 10.0% in FY21.

SUNDRAM FASTENERS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	37,232	36,443	-2.1%
Other income	Rs m	281	274	-2.5%
Total Revenues	Rs m	37,513	36,717	-2.1%
Gross profit	Rs m	5,929	6,641	12.0%
Depreciation	Rs m	1,699	1,797	5.7%
Interest	Rs m	579	261	-54.9%
Profit before tax	Rs m	3,932	4,857	23.5%
Tax	Rs m	666	1,230	84.6%
Profit after tax	Rs m	3,265	3,627	11.1%
Gross profit margin	%	15.9	18.2
Effective tax rate	%	16.9	25.3
Net profit margin	%	8.8	10.0

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SUNDRAM FASTENERS Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 11 billion as compared to Rs 11 billion in FY20, thereby witnessing an increase of 7.8%.
• Long-term debt down at Rs 3 billion as compared to Rs 3 billion during FY20, a fall of 18.4%.
• Current assets rose 23% and stood at Rs 17 billion, while fixed assets rose 3% and stood at Rs 23 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 39 billion as against Rs 35 billion during FY20, thereby witnessing a growth of 11%.

SUNDRAM FASTENERS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	19,959	23,471	17.6
Current Liabilities	Rs m	10,621	11,450	7.8
Long-term Debt	Rs m	3,250	2,652	-18.4
Total Liabilities	Rs m	35,486	39,292	10.7
Current assets	Rs m	13,552	16,662	23.0
Fixed Assets	Rs m	21,934	22,630	3.2
Total Assets	Rs m	35,486	39,292	10.7

SUNDRAM FASTENERS Cash Flow Statement Analysis

• SUNDRAM FASTENERS's cash flow from operating activities (CFO) during FY21 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -3 billion, an improvement of 28% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -159 million from the Rs 208 million net cash flows seen during FY20.

SUNDRAM FASTENERS Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	7,177	4,540	-36.7%
Cash Flow from Investing Activities	Rs m	-3,212	-1,979	-
Cash Flow from Financing Activities	Rs m	-3,768	-2,702	-
Net Cash Flow	Rs m	208	-159	-

Current Valuations for SUNDRAM FASTENERS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 17.3, an improvement from the EPS of Rs 15.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 800.9, stands at 46.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.2 times, while the price to sales ratio stands at 4.6 times.
• The company's price to cash flow (P/CF) ratio stood at 20.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	177.2	173.4
TTM Earnings per share	Rs	15.5	17.3
Diluted earnings per share	Rs	15.5	17.3
Price to Cash Flow	x	12.3	20.8
TTM P/E ratio	x	18.7	46.4
Price / Book Value ratio	x	4.4	4.8
Market Cap	Rs m	88,511	112,876
Dividends per share (Unadj.)	Rs	4.2	4.7

Ratio Analysis for SUNDRAM FASTENERS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.5x during FY21, from 1.3x during FY20. 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 19.6x during FY21, from 7.8x during FY20. 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 15.5% during FY21, from 16.4% during FY21. 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 19.6% during FY21, from 19.4% during FY20. 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 9.9% during FY21, from 10.8% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.3	1.5
Debtors’ Days	Days	6	9
Interest coverage	x	7.8	19.6
Debt to equity ratio	x	0.2	0.1
Return on assets	%	10.8	9.9
Return on equity	%	16.4	15.5
Return on capital employed	%	19.4	19.6

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

SUNDRAM FASTENERS Share Price Performance

Over the last one year, SUNDRAM FASTENERS share price has moved up from Rs 291.4 to Rs 800.9, registering a gain of Rs 509.5 or around 174.9%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of SUNDRAM FASTENERS